For CPOs looking to thrive in the 2020s, Supplier Management has been the hot trend; but, Best-in-Class Supplier Management has never been out of style. In fact, suppliers today have a more direct impact on your company’s revenue, its products, AND customer satisfaction than ever before. In today’s market, supplier management cannot be an afterthought, it must be front and center for every procurement team and it should be a big part of every CPO’s Strategic Agenda for 2022. Ardent Partners recently developed a recipe for Best-in-Class Supplier Management.
Before we being cooking, two points:
Supply Management is the term Ardent Partners uses to describe the methods, strategies, technologies and overall activities that support the sourcing/procurement/management of all third-party goods (direct, indirect, cap ex.) and services. This term can be used interchangeably with the “Source-to-Settle” or “Source-to-Pay” processes and “Spend Management.”
Supplier Management is the series of processes related to the holistic management of the supplier relationship. IT includes Supplier Identification, Supplier Information Management, Supply Risk Management, and Supplier Performance Management.
Across all processes, the management of your talent, systems, and operations. Develop a winning recipe that makes your procurement department work better by
- Mapping your current business needs and procurement processes by business unit, region and category
- Devising a winning process to cover your global procurement needs and turn it into a competitive edge
- Finding the right technology that will address most of your acute pain points and link your end-to-end procurement processes together
Supplier Management is a full course meal that starts with finding the right suppliers. The fact is, meeting suppliers isn’t hard, but finding the rights ones and managing them well is. Heightened volatility in a market that has become increasingly global and increasingly complex means that businesses are more reliant upon their suppliers than ever before. In fact, for many procurement organizations, the greatest opportunities to drive near-term value occur within the supplier management process. and it starts with the appetizer – Supplier Identification
There are many ways to identify suppliers, chief among them is strategic sourcing which Ardent defines as “The business process that leverages process automation tools to quickly identify, evaluate, negotiate, implement, and adjust the optimal mix of goods and services that best support the constantly evolving objectives of the enterprise.”
Next is supplier information management. The supplier record is an important mirror of how an organization is perceived or operates to wit:
- A supplier record can be connected to significant dollars in spend, so accuracy and consistency of the record is critical for uninterrupted business
- The single source of truth of supplier information is THE critical foundation for successful supplier management
- How to achieve this: unified vendor model in the cloud with bi-directional sync with ERP
- A single source of truth for supplier lifecycle, performance and ongoing risk management
- Simplifies your interaction with your suppliers and vice versa (the time they need to enter and update the same information for all of your inquires)
- Robust supplier portal/network that enables self-service supplier information and risk management
- Supplier self-service to keep their information up-to-date
RELATED RESEARCH
Tomorrow we’re hosting a webinar on this topic – we’d love to see you there!
