Future Trends in Supplier Relationship Management & Webinar Highlights

Future Trends in Supplier Relationship Management & Webinar Highlights

SRM, SUPPLIER RELATIONSHIP MANAGEMENT, Supplier Relationship
Rules, 3. Reshape Supplier Relationships

OVERVIEW

The New Rules of Procurement Engagement is all about challenging the norms and embracing a new way of thinking that is better suited to today’s ever-evolving commercial world.

As a roundup to Rule 3: Reshape Supplier Relationship Performance, we asked leading industry changemakers for their thoughts on emerging trends that will shape supplier relationships that Procurement should be taking action on right now. Read on… or Download the eBook now!

Did you miss the Rule 3 Live Debate? Watch on-demand or see below for highlights.


EMERGING TRENDS IN SUPPLIER RELATIONSHIPS

Pierre LapréeScarcity of resources

Pierre Laprée, SpendHQ

“We are entering a state where many resources are scarce. As a result, you need to secure your access to those resources, because everybody is competing for them. On the flip side of that, you also need to find a way to require less of those resources because as they become scarce, you need to limit your reliance on them.

This means that you need to change the way you manage your suppliers. On the one hand, you need to make sure that you have this very invaluable position of ‘customer of choice’ when your supplier has to prioritise who they ship to—you better make sure that you have a good relationship with them so that you are near the top of the list.

And similarly, the only way to know how to reduce your reliance on something is to work with that supplier, or with other suppliers, to understand what would be an alternative or what would be a way to reduce waste or consumption.” 

Temeena HussainPromoting sustainable practices

Temeena Hussain, Market Dojo

“The focus that I find in the market by speaking to suppliers and to buying organisations, is on promoting sustainable practices which then enable fostering innovation and engaging stakeholders to align environmental, social and governance standards.” 

 

Sheldon MydatLeveraging unstructured data

Sheldon Mydat, Suppeco

“What’s really important is the ability to create a narrative. So rather than just having a KPI dashboard or lots of KPI dashboards, it’s the narrative behind the KPI – that’s what’s really important…

…And the narrative is not just one-sided, it’s this equitable space for your supply chain to come together.

…90% of company data is unstructured. Large language models (LLM) focus on the unstructured data so we think we’re going to see a lot more of this unstructured data within a supply chain setting. It’s almost a private LLM; to a supply chain; to the business ecosystem.

We (Suppeco) create the operational; the digital relationship layer from all this unstructured data. We use generative AI to analyse it using sentiment analysis and psycho-linguistic intel to analyse what’s going on in the space.

All these different moving parts [in the supply chain] on a global scale mean it’s [KPI dashboards] got to leverage live dynamic data. It’s got to be 24×7 because the operations are 24×7—they’re going on all around the world. I call this [emerging trend] live dynamic narrative, happening within the operational data layer.”

Pierre Laprée

Sensitivity to public opinion

Pierre Laprée, SpendHQ 

“More and more, the public is becoming aware of and paying attention to incidents. If the public takes offence to something that happens, it can have a terrible effect on a company. What we generally find is that a supplier is involved in these incidents. There have been examples in the clothing industry where a building collapsed and that created a well deserved outrage, or you will have some problem with food quality or food poisoning, and you can generally always trace that back to supply chain issues.

Now, companies will have an even more vested interest in making sure that they have the right relationship with the right suppliers so they can prevent the public taking offence to what they are doing.

I don’t know if it’s for better or worse that there can be such a massive outburst in public opinion, but it’s a trend you cannot ignore.

Overall, it’s a good idea to manage your supplier relationships as well as possible. If you can avoid backlash from the public opinion, everybody wins.”

WATCH THE FULL VIDEO – RULE 3: EMERGING TRENDS IN SRM

 


RULE 3 LIVE DEBATE

Hosted by Market Dojo, our Rule 3 changemakers came together to answers questions on the key themes of this topic, namely

  • The AI Fast Track
    How can AI be used to rapidly transform traditional methods of managing supplier relationships?
  • The Death of Strategic Suppliers
    Is it time to move on from strategic vs. non-strategic suppliers?
  • Beyond ESG and Supplier Diversity
    What’s the real impact (& strain) of ESG and supplier diversity on long term business growth?

Here are some highlights from the webinar.

“It’s now staring us in the face that a cost driven model is not enough to deliver us the kind of resilient services that we require in today’s world. So we need to think more about how to build agility, versatility, flexibility—all of these things that help create longevity in a service. And you can’t do that by just focusing on the bottom line. This is why we’re seeing the golden year of supplier relationship management.” Sheldon Mydat, Suppeco

“The necessity to become a customer of choice, and have better data for more transparency and better communication, has shifted supplier relationships for the better, in my opinion. The thing that takes a bit more time to evolve is the mindset and the behaviour of people but I think that we’re on the right track.” Pierre Laprée, SpendHQ

“For us at SpendHQ, the most exciting aspect here is the ability to combine new sources of data together to generate much richer insights into what we’re doing. We used to rely almost solely on spend as a way to rank suppliers, to assess whether they are critical or not. Sometimes people throw in some performance survey, but that’s a rather narrow way to look at the relationship with the suppliers, especially with the amount of disruption and risk that we’ve seen emerge on the supply chain. So, a lot of companies have added new ways to assess risks, financial risks, CSR risk, operational risk, cyber risk. And all these things can now be combined to give us a much more complete view, a 360 degree view of the relationship with the supplier and the level of risk that they are exposed to, and as a consequence that you are yourself exposed to. That is really important because we have clients who have sometimes more than 100,000 suppliers. How do you make sense of all that data? Clearly AI is a game changer because it’s not only about the commercial terms anymore, but it’s also detecting weak signals before they actually turn into into issues. And for me, that’s where AI will provide a lot of value on the spend intelligence part.” Pierre Laprée, SpendHQ

“What stands out for me and will significantly change supply relationship management is the future of predictive analytics. Obviously, we know that AI has the ability to analyse a vast amount of data, but also I think what’s really important in terms of the future is predicting trends, patterns and potential disruptions in the supply chain…. predictive AI will enhance the ability for businesses to plan and execute more efficiently.” Temeena Hussain, Market Dojo

“One piece of advice that we could give to the audience [on how to get started with AI] is have a plan and know where to start and learn how to scale based on that. A lot of people have no clue what they’re doing [with AI] so start small and start with a pain, with something that you need to achieve, that gives a very solid blueprint. If you have a specific pain point, like summarising exchanges with a supplier in terms of a contract, that’s where LLMs are very good. So experiment. There’s a lot of value in experimenting and if you try five things and one works, you’ll be good. You’ll be lucky. You’ll be in a good position to start iterating on that.” Pierre Laprée, SpendHQ

Enjoyed this extract? Watch the full webinar recording…

Rule 3 Live Debate - Reshape Supplier Relationships

 

…Or, download your copy of the Reshape Supplier Relationships eBook

Download How to Reshape Supplier Relationships eBook by Market Dojo

MORE FROM THE NEW RULES:

 

June 19, 2024
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