I read an interesting article recently on the virtues of Supplier Relationship Management or SRM. (Yes we’ve all read one of two of those before). One could even be forgiven for assuming that SRM is now widely utilised as a matter of general good practice! Well I can tell you now that it isn’t!
But it’s good to see that more and more CEOs’ recognise SRM’s potential for generating value, increasing revenue and profit, essentially by incentivising and nurturing better reciprocal third party relationships.
Indeed a number of our clients are now benefiting by optimising traditionally non-contracted aspects of their supplier eco-systems – important areas such as horizontal (or group) as well as traditionally bilateral collaboration, innovation, thought leadership, shared R&D to name a few.
For example, clearly defined structure and process, designed to guide and enable reciprocal performance measurement is key to collaborative SRM. Definition and clarity in an area that was once historically hard to quantify can now be robustly monitored and commercially incentivised.
But, if such a process is to work, we are required to operate alongside our suppliers and partners – precisely defined by a simple venn diagram. We each have our unique identities, whilst we also share a degree of commonality. It’s tapping into this commonality that drives our ability to collaborate, whilst it’s our unique identity that ensures we drive our own businesses forward.
It’s this combination of corporate identity and strategic alignment that defines a truly strategic relationship. An efficient strategic relationship cannot be so without being fundamentally collaborative.