Maximize the Value of Your SRM
A 2017 Global SRM research reported that your ‘soft skills’ are at the core of building your Supplier Relationship Management (SRM).
Whether you need a whole dedicated department to manage vendor relationships or a dedicated SRM Manager, having the right fit of skills and team members in your organization matters.
Typically, when streamlining the SRM process, industry leaders create documented procedures that assist their teams. For example, in large organizations, managing SRM processes include anything from flowcharts, Standard Operating Procedures (SOPs), or any policy documents and agreements that cover all the obligations between participating parties.
When an organization has a structured approach towards their SRM tactic, there’s a higher chance of having a more favorable level of engagement from suppliers, which creates stronger bonds with your vendors while maximizing the value of your SRM.
It’s essential that your SRM focus is strategic and focused on growth, rather than a reactive focus.
Reactive vs. Strategic
It’s best practice for management to “make things happen” in order to take advantage of their opportunities. For this to happen, you must shift your perspective from an operational view of just ‘purchasing’ to a strategic perspective of supply management.
It’s also essential that your SRM focus is strategic and focused on growth, rather than a reactive focus. For example, if you’re managing your SRM through the perception of responding to a negative situation, this is a reactive approach.
To be strategic is to manage your SRM through planned agreements before the supplier signs his/her name. Planned agreements ensure the company’s competitive advantage overall and lead to more successful relationships even in the early stages, instead of consuming time and resources on figuring out how to improve a scenario or micro-managing unreliable suppliers.
Call Ferrandino & Son at (866) 571 – 4609 or email our business development team at sales@ferrandinoandson.com to learn more about our relationship initiatives.
Create the Value You Want
All your suppliers are necessary factors for your company. They drive a central role in supporting your revenue. Thus, working with reliable suppliers is crucial to your business’s growth scale.
Unreliable suppliers can create problems in your workflow and can negatively impact your clients. Sometimes it’s better to pay a higher value to do the better service, which invests less time to micro-manage, as mentioned.
Additionally, paying attention to removing biases and personal feelings from a business agenda is also important. Choose from the angle of being efficient, and realize you’re striving to create the value you want.
A well-documented Supplier Relationship Agreement will reduce the possibility of confusion or disputes.
Be Detail Oriented
Details matter when it comes to communicating with your vendor. Supplier Relationship Agreements (SRAs) are necessary, so be detail-oriented and write down everything that comes from your partnerships. Such as service descriptions, prices, delivery of services, and payment terms.
A well-documented SRA will reduce the possibility of confusion or disputes. It’s often a good idea to create a flowchart or deck to explain your team’s process, so information is easier to find if something goes wrong in the workflow.
Having an SRM process is essential but getting everyone in your organization to participate is critical. Every penny saved goes straight to your bottom-line.
Following best practices and using organized methods will help you streamline your SRM practices, giving your team members clear guidelines for purchasing and allowing them to spend more time on their key responsibilities.
CONTACT US
Are you looking for the right partner to build a great connection? To learn more about Ferrandino & Son, Inc. contact us now and let the connecting begin!
Phone: (866) 571-4609