Picture the scene; last year you attended an inspiring conference where you listened to speakers waxing lyrical about the benefits that were emerging from their shiny new supplier relationship management (SRM) programme and how they’d moved into the new post-contract value improvement game. You thought “that’s just what we need” and off you trotted to launch your own programme.
Months go by and your programme is struggling. People just don’t seem to ‘get it’; stakeholders and your team show little interest and meetings with suppliers have reverted to old-style tactical and reactive blaming; collaboration has proved a hollow promise. Performance benefits and evidence of any tangible progress are hard to come by. You’re left scratching your head, puzzled as why it’s not working here when it seemed to be working elsewhere perfectly well.
It seemed so easy; you had your people trained in interpersonal skills, you asked them to meet regularly with the suppliers, and magically, you expected relationships to improve and, ker-chinnng, savings would drop into your lap.
You ask around in an attempt to understand the issues and you’re bombarded with familiar excuses; efforts to fix urgent problems overriding the meeting schedules, organisational restructuring, suppliers seem have too much power and won’t co-operate, stakeholders keep changing their requirements and won’t show up to the meetings, there’s no reliable supplier performance data available anyway, even if we had the time to do this SRM stuff….
Taking time to reflect, you and your leadership team start asking questions about your collective role in making SRM a success; did you take the time to properly understand what SRM would mean for your business? How much effort was required to cement new working practices based on working systematically, rigorously and consistently? Did you undertake an honest assessment of your team’s readiness to change its ways of working from reactive, sometimes cosy supplier engagement, to a level of professionalism represented by the disciplined, and continuous pursuit of value for money improvement? Did your leadership team take a genuine interest in precisely how progress was going to be monitored and governed, and was your role that of coach and mentor, or did you only have time to add-up the monthly savings numbers (what little there were)? And, truthfully, did you expect real improvements at all, or was it more about being seen as having a programme, just like your conference-attending peers?
Maybe you’ve come to the conclusion that now is the time for a re-launch (yours wouldn’t be the first business to have one of those) but this time you’re going to be much clearer as to why you’re going to deploy SRM at all. This time you’ll be thinking about tangible goals and targets, but you’ll resist imposing arbitrary targets, as each supplier relationship has its unique circumstances and potential for value improvement. You’ll accept that SRM is a slow-burn and it will take time for new practices to bed-in and benefits to accrue. This time you’ll assign active sponsorship roles to your leadership team and expect them to bring their experience and skills to the aid of supplier relationship managers. You’ll take the cross-functional-working message out to key stakeholder groups with enthusiasm and commitment. You will begin to value the importance of having a fit-for-purpose process and toolkit that you will prove via a number of pilot relationships and, this time, you won’t let up in your success aspirations; year-on-year improvements in performance and value for money is the new paradigm – no excuses.
There will be no doubt in the minds of anyone in your team; this time, if we’re going to practice SRM, we’re not going to tinker and play; we’re going to demonstrate a real commitment to achieving excellence and bring home tangible and sustainable improvements. You’re determined to act with genuine intention; this time it’s for real.
Then a little later, when you can see positive momentum and a renewed vigour amongst your team, you’re going to check the date of next year’s conference and you’re going to pick-up the phone to the organiser responsible for booking speakers. Next time it’ll be your turn to share how it’s done.
By David Atkinson