Living in a highly client-oriented time where businesses mostly focus on maintaining and improving client relationships, you shouldn’t look down upon the significance of good supplier relationship management. A healthy business model will essentially benefit from solid and long-term supplier relationships. Read more
Supplier Relationship Management (SRM) techniques are strategic developments in businesses that are focused on optimizing and effectively manage the connections between third-party companies that supply goods and services to the business.
Most medium to large size companies work with a huge number of suppliers, which fuels supply chain complexity. The number one mistake in procurement is that companies fail to properly manage their suppliers and the related external spend.
“Don’t manage costs. Manage suppliers” is our motto. Why? Because it makes financial sense.
In this article, I will shortly explain the reasons for this motto and explore why procurement should pay greater attention to the supplier management practice instead of having a narrow focus on price and cost saving.
Recently, an honest procurement leader asked us the question: ‘What is SRM?’
I think this is a very relevant question, as there seems to be no consensus on what SRM really is. In my experience, you can ask ten CPOs this question and you would probably get ten different answers.
Currently you may get along well enough using tools such as Excel, online surveys, contract management tools and data warehousing to manage the procurement function. As businesses and procurement evolve and become more complex, so does your relationships with your suppliers. Read more
How did you get your start in procurement?
Lars: It was actually a complete coincidence. I studied Supply Chain Management in business school but my first job was in a research company carrying out customer satisfaction surveys. I quickly discovered that my interest lay elsewhere and found a job as a procurement analyst at Wolseley, the world’s largest distributor of plumbing articles. Read more
For years, driving a hard-bargain and negotiating costs were the primary skills expected from anyone with procurement or purchasing in their job title. Employee profiles, job descriptions and training programmes all centred on principals of saving a company as much money as possible, sometimes to the detriment of a successful supplier relationships. Read more
