The buyer-supplier relationship has undergone many changes in the past several decades. From the 1980s, when timely availability of products and services was the key buying criterion, the buyer-supplier relationship matured to focus on both spend and risk reduction in the 2000s. Today, the buyer-supplier relationship is reaching another inflection point where enterprises are finding little value in focusing only on spend and cost reduction and are demanding suppliers to co-innovate and engage with them in strategic partnerships, giving rise to the concept of supplier management.
Supplier management entails a complete overhaul of each and every step in the supplier-buyer relationship, including the use of technology. The advantages of developing a supplier management strategy encompass multiple dimensions, including easier and much more productive relationship management with gains for both the parties.
In this research, we highlight the challenges buyers and suppliers face in their relationships today and how supplier management can help to solve them.
Some of the findings in this report are:
The buyer-supplier relationship continues to be mired in myriad issues
Whether it is payments, quality, or innovation, buyers and suppliers often have conflicting views
Moreover, buyers’ expectations from suppliers are also moving beyond only cost and risk management, opening new confrontational fronts
The solution to the majority of these buyer challenges is a comprehensive supplier management strategy
Supplier segmentation and developing a strategic partnership is one of the key steps toward successful supplier management
Role of technology gaining traction in supplier management due to increasing complexity of supplier relationships
A successful supplier management strategy involves multiple stages and needs both capital and time investment from enterprises
The successful implementation of the supplier management strategy can enable buyers in developing strategic partnerships with suppliers
