SRM Video Series: #2 Meeting the Needs of Stakeholders

In the first video of this short series I discussed how important it is for your SRM to have a clear over-arching purpose – the reason why SRM might be (i.e. probably is) important to your organisation.

In this second video of a short series on SRM, I’m going to talk about….

Who benefits?

And here’s the video transcript….

An Achilles Heel for many procurement organisations is their relationship with other business stakeholders: the struggle to become relevant in a business that sees procurement as merely a service function, and not the strategic contributor many professionals believe it is (or at least can be).

For most stakeholders, SRM will be just another Procurement initiative, something that might get in the way of, or slow down, their own day job. In these circumstances, suggesting that you’re implementing SRM because the boss said so, or because a competitor organisation has done so, is not going to generate the enthusiasm and support required to make the programme a success.

CPOs need to answer the ‘what’s in it for me?’ question for every stakeholder constituency in the organisation, because they don’t all want (or would benefit from) the same things from an SRM programme. Let’s think about what is likely to be in the minds of some stakeholder groups….

  • Finance want numbers (savings and, of course, delayed payment terms)
  • Operations want a fast and reliable supplier response, delivered on time
  • Quality Assurance want compliance and maintenance of standards and specifications
  • Design want supplier innovation, ideas and engagement with their new products and services pipeline
  • Marketing want suppliers to provide financial contributions to promotions, and to potentially enhance the end-customer experience of your company….
  • ….And of course senior management want the whole SRM enterprise to provide a favourable return on investment.

CPOs must define the SRM value proposition to each of these constituency groups, ensuring that those value propositions are both constructed jointly with those stakeholders, and endorsed by them.

The key question will always be to what extent does SRM demonstrably contribute to the success of each group of stakeholders (how can it make their work easier and better), and the organisation as a whole?

In the next video I’m going to talk about what we mean by value for money….

One thought on "SRM Video Series: #2 Meeting the Needs of Stakeholders"

  1. alun@marketdojo says:

    What we have found that the initial drive for SRM has been around the on- boarding. The initial benefit is essentially the supplier core information management and insurance.

    However, as they progress on the journey they find many other benefits (as you mention) around stakeholder engagement, requesting further information, tracking department engagement through to detailed reporting on suppliers.

    The key that we have found is to help clients be flexible around managing this process and adapting it to their needs.

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