Supplier Relationship Management: Where's the ROI for your Business?

Although it’s not making international headlines on a daily basis, Supplier Relationship Management (SRM) is one of the most influential elements of a procurement and sourcing strategy.

SRM is a discipline built for leveraging the relationships between buyer, and supplier, to build value for an organization’s top-line value while cutting bottom line costs. Successful supplier relationship management can have lasting impacts upon an organization’s business-critical KPIs within purchasing, strategic sourcing, and category management activities. SRM is the chameleon of procurement and sourcing organizations: hard to maintain a stable ownership over, but remains adaptable to multiple environments.

Every business ecosystem that has clearly defined production and purchasing of products, goods, or services has the need for an application of supplier relationship management. But, it’s important to keep in mind that managing relationships with suppliers is an effort that is completely relative to each and every organization. And, with this being said, every organization will reap benefits in different magnitudes from the application of SRM.

Great! Now we have an understanding of supplier relationship management, and it’s benefits, on a very Meta level. But, even if you’re remotely interested at this point, you’re most likely still thinking, ‘this is all rather unsexy’.

Let’s dig a bit deeper, and discuss the benefits of supplier relationship management in a bit more captivating manner.

In the words of Jerry Maguire, “SHOW ME THE MONEYYYYY!”.

That’s right, I’m guessing I have your attention now. Money talks. And the real value of a strategy’s return — such as SRM — is directly correlated with the ability to monetize.

So…

How can your business start seeing a Return On Investment (ROI) from focusing on the execution of SRM?

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