In an enterprise, stakeholders rely on the value provided by suppliers to perform their jobs. If the suppliers they rely on fumble more often than not, stakeholder effectiveness will be limited. As such, the role of Procurement transcends simple cost savings. To win, Procurement must procure suppliers that consistently deliver stakeholder expectations.
In discussions with supply chain stewards (procurement, sourcing, vendor management), we learned that stakeholders don’t always cooperate. Most only provide feedback when major issues arise. In many cases, the feedback only comes from select individuals.
- Compare supplier performance
- Make timely single sourcing decisions
- Drive supplier performance improvement plans
- Encourage more meaningful collaboration between suppliers and internal stakeholders
The goal is to increase the value provided by suppliers. (more on that here) Doing so requires insight into the minds and opinions of stakeholders. Hence the need to engage internal stakeholders. To do so, try the following:
- Own the supplier performance feedback process.
- Suppliers shouldn’t own the process, because they’re not positioned to be objective. Nor should Stakeholders own it, as they exists for a different set of performance goals. As owner of the relationship, supply chain stewards are best positioned to objectively track supplier performance.
- Standardize the process.
- By using a consistent approach to evaluate supplier performance, insights to strengthen the supply chain can be identified and implemented faster. (more on that here)
- Simplify the process.
- Keep it simple and don’t overcomplicate things. At the end of the day, stakeholders are people, and people have expectations. So ask yourself, when does a simple question like “Did the supplier meet your expectations?” warrant customization?
- Automate the process.
- There are times when Excel/PowerPoint are suitable. But supplier performance oversight isn’t one of them. The goal is to eliminate any activity that requires manual labor. Identify a system that enables you to push a button and watch it work.