Supplier Relationship Management

I guess it was my particular managerial experience with high value packaging lines involving major installation, servicing and material supply that made it natural for me to look at SRM and CRM as pretty obvious things to do even in the "round"  world ( as opposed to the flat world ). Frankly, as any system supplier of equipment that requires installation, service and consumable supplies will tell you – you need to have the appropriate multi-level deep customer relationships to make things work. Things become interesting , for the buyer, if it is not a system that the buyer buys but tries to aggregate components from different suppliers. (Hint:think of the time you had more than one contractor doing home improvements, at your home, simultaneously !!). Starting here, the buyer needs to become active in keeping up with multiple suppliers through appropriate Supplier Relationship Management (SRM).

A recent article in the Boston Herald makes the interesting point that while sourcing has developed into a fine art, supplier relationship management is evolving and is in the early stages. Naturally, with outsourcing on a global scale in multiple tasks  the need to pull together supplied services, components,products,ideas,feedback,intelligence from global suppliers is becoming really challenging.  Is it necessary to know what your suppliers are discovering ? You bet- because suppliers are operating at a point in your value chain where you are simply not there. To stay on top of your value chain you need to listen as closely to suppliers and you should be listening to your customers. An added advantage with suppliers is that the are generally more willing than your customers to follow reporting and metrics if you work to set them up at contract renewal  or start-up points. SRM systems are rapidly evolving to have an IT handle on the complex  global supply scenario that is becoming routine in organizations.The prospects of saving 20-30% of contracted work value is a very real incentive to accelerate to enhance organization wide SRM adoption.

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