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21 March 2013

News - A gradual approach to Supplier Relationship Management works best


By SalesProEd @ 18:38 :: 982 Views :: 0 Comments :: Article Rating
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Taking a gradual approach to Supplier Relationship Management projects rather than going for a “Big Bang” implementation usually produces the best results, say procurement consultants Efficio.

This is one of the tips offered in Efficio’s latest Viewpoint article titled Supplier Relationship Management: All talk, no action?

SRM is generally acknowledged to be a good thing like motherhood and apple pie, but very few organisations invest the time and resource to do it properly, say the authors, Efficio Principal Julian Catchick and Consultant Miguel Oliver. The result is that SRM often fails to produce the promised benefits.

Barriers to implementation include taking too narrow a focus on pure sourcing activity, problems with gathering data and engaging stakeholders within the business and suppliers externally.

SRM is a long-term, methodical approach to interacting with suppliers in a systematic, strategic way to achieve lasting benefits on both sides, Catchick and Oliver say.

“However, the evidence suggests that while many organisations talk of SRM, few actually implement it successfully. Few, it seems, reap the full benefits a sophisticated SRM programme has to offer.

“Our experience with companies across a range of sectors shows that the challenges commonly faced with deploying SRM can be overcome fairly simply with the allocation of the appropriate processes and resources.”

The Viewpoint authors explain: “The most common challenge faced is whether to adopt a “big bang” approach to SRM or to approach it in an incremental manner. There are clearly pros and cons to both. Most organisations, however, find it easier and more manageable to adopt an incremental approach focusing on a discrete area of expenditure such as IT or a small selection of priority categories.

“Doing this enables an organisation to pilot and quickly improve and customise the SRM approach before rolling it out to the wider organisation.”

They conclude: “If organisations take the time to frame the challenges and concerns they face and start by addressing one or two of them, this can create the positive momentum to methodically address the other challenges.

“Starting anywhere as opposed to cowering in fear can provide the confidence needed to move forward. None of the challenges outlined here are insurmountable and most can very easily be overcome.”

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