This week, we sat down for a webinar with the experts to talk about how all the efforts that go into managing your suppliers can bring additional value to your organization when done well—or can end up costing you significant time and money when not done well. Chris Sawchuk, Principal and Global Procurement Advisory Practice Leader of The Hackett Group and our own Carl Bergauer, Field Sales Director, provided buyer and seller perspectives to this growing concern. So what were the top takeaways?
Most businesses are incorporating Supplier Relationship Management practices even if they don’t realize it.
There are a lot of unique opinions on what, exactly, makes up Supplier Relationship Management (SRM). But even if you’re a small or mid-sized business, SRM is just part of what you do, including all the activities you incur when you choose a vendor to supply your business. Chris described SRM as particularly inclusive of three things: performance management, capabilities management and risk management. How are your vendors doing? What are your suppliers doing? And is that how and what likely to have a positive or negative impact on you based on their business?
Budget, influence and innovation are just a few of the top concerns of professionals who are responsible for buying for their business.
While the average administrative professional might not think of themselves as being in a procurement role, the things that impact them are impacting larger procurement organizations, too. According to The Hackett Group’s research, purchasing professionals have a number of goals and concerns that are top of mind for them, including how to reduce and avoid purchase costs, how to increase their influence in their company, and how to demand and take advantage of supplier innovation. Regardless of the size of your business, you’re likely trying to keep costs down, working to maintain a voice within your larger company, and striving to get the most from your suppliers.
Getting good value from your suppliers also includes being a good customer.
If you’re striving to get the most from your vendors, that includes demanding more from yourself and your end users, as well. “Have an objective,” says Sawchuk of managing suppliers, “And make sure others are aligned to it.” It’s important that everyone in your company knows and understands your established supplier relationships, and how utilizing those relationships dependably can increase value.
“Organizations aren’t utilizing their suppliers are expert consultants often enough,” states Carl Bergauer, citing his experience in the vendor’s seat. In his experience, the best relationships between buyer and seller occur when the buyer demands consultative collaboration from their supplier—and the supplier delivers. Sawchuk agrees, suggesting implementing a “Voice of the Supplier” feedback process to get insights and recommendations from suppliers.
While the intricacies of SRM and how buyers can get the most from their vendors are far more numerous, these three takeaways are certainly thought-provoking and actionable. How are you engaging your end users as you seek to supply your business, and what kind of insight and knowledge are your vendors sharing with you to help?