The Importance of Supplier Management in Today’s Dynamic Supply Chain

  • November 25, 2021
  • 2 Mins Read
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“Supplier Management” is a widely used and well-known term in the supply chain world, but in practice it can mean different things to different people. Different Industries have identified the key requirements that are most important and have the greatest business impact.  The requirements for Supplier Management in the medical device field can be quite different from that of the fastener supply industry for example.

Today, Supplier Management for an organization means maintaining a level of visibility and control over the company’s supply base that effectively supports the company’s supply chain strategies and execution.

In some cases, the requirements for a company’s suppliers are clear and well defined, for example recognizing compliance for industry accepted quality assurance standards, where in other cases companies develop their own requirements based on their own specific needs.

In today’s dynamic, connected and increasingly global world of procurement, the need for a formal process and a system to manage that relationship with the supply base is becoming more and more critical to our overall sourcing strategies.

How do we do it?

There are several straightforward tactics for implementing and operating a Supplier Management program that apply to any organization with a diverse supply base and an existing lack of overall control.

Begin to invest in your supplier relationships with clear communication, resources, and actions. Connections with your supply base must be more than sending out Purchase Orders and expecting material to show up at your dock.

Position your organization as the low-cost and low-hassle customer to work with. Make connections with your team easy, quick, and where possible automated so suppliers find it simple to work with you.

Actively evaluate and re-evaluate key supply base areas. Draw on your suppliers for information on their experience, capabilities, and their performance operationally and financially.

System Support

System tools become key to maintaining our relationships with suppliers as we work to standardize our interactions with the supply base and increase engagement without adding manual effort.

Supplier Self Evaluations – Share with your suppliers their performance from your perspective, while giving them an opportunity to add information to the system that will be beneficial for both partners.

Onboarding – A professional and coordinated on-boarding process moves new suppliers into your system with better information and more quickly so they can begin to contribute in a shorter timeframe.

Risk Management – More and more important in today’s world, regularly capturing risk mitigation information from your suppliers identifies opportunities across the supply chain to reduce your overall exposure

QLM Sourcing and Supplier Management provides an integrated toolset that combines the eSourcing and Supplier Management requirements in one comprehensive system. The information gathered through supplier surveys and self-evaluations is combined with a supplier’s performance on sourcing events to provide a holistic view of a supplier from a strategic perspective. Combine that information with the execution data available from your ERP for a complete, 360-degree view of your supply base.

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