It is time to reinvent the way procurement manages supplier information
‘Back in the day’ procurement professionals used to talk about Supplier Information Management (SIM). Over time, information about supplier performance against established KPIs was incorporated and the effort became known as Supplier Performance Management (SPM). Now that supply base collaboration is all the rage, you’re more likely to read about Supplier Relationship Management (SRM), although it is really just SPM spelled with an ‘R’.
And yet, despite the terminology changes and the desire for procurement to become a more strategic partner to the enterprise, none of initiatives truly reflects how companies actually manage and leverage their knowledge about suppliers.
Recent research tells us that 70% of procurement and sourcing professionals see internal peers as the most credible source of supplier intelligence. 64% of the same participants are not happy with the technology available to them.
From this, we can conclude that most supplier knowledge exchange is taking place outside of sourcing, supplier management, and eprocurement systems. Maybe it is time for more than a change to our acronyms: maybe it is time to reinvent the way procurement manages supplier information.
First priority: Manage supplier knowledge and the information will take care of itself.
Technology platforms for managing and distributing supplier knowledge can simplify and accelerate the supplier identification process and enrich the pool of suppliers, but these tools are not yet used on a widespread basis. Similarly, improving ease of use and internal stakeholder collaboration/access to knowledge can greatly simplify the process by providing fast access to a preferred supplier list and improving supplier search turnaround times.
There are many best practices that support investments in relationships between procurement, internal stakeholders, and suppliers. Supplier discovery and intelligence building is one of the processes that brings all three groups together. Technology that is simple, intuitive, and combines peers’ supplier insights with up-to-date supplier information will provide a trusted, centralized source of supplier intelligence that transcends staffing and point of contact changes.
For more information on recent research into the challenges and opportunities associated with supplier knowledge management, click here to download the whitepaper: Improving Strategic Supplier Identification Through Technology