Today’s post is by Heather Powell, Director at SafeSourcing Inc.
I recently read an article, “Procurement & Sourcing Predictions for 2015,” that speaks to new trends in 2015. One piece of the article caught my eye.
Supplier Relationship Management in Highly Regulated Industry – Supplier relationship management (SRM) is becoming a more widely accepted best practice across global organizations, but still lacks popularity due to unclear program definitions and/or lack of internal buy-in. However, in highly regulated industries, such as pharma and banking, SRM is an ideal solution for managing supplier risk as well as cultivating value from the supply base after the contract has been signed. SRM provides a controlled framework to manage suppliers who handle proprietary information or work directly with customers.
Strategic sourcing projects frequently generate significant cost savings, which have a very favorable ROI considering the low-cost required to implement. However, as these gains are realized, it is becoming increasingly difficult for companies today to generate the same level of returns year after year by utilizing the same sourcing techniques and tactics. Moreover, research has shown that, as supplier relationships are proactively managed, the initial benefits derived from the strategic sourcing efforts are not only maintained, but improved. The opposite is true for those supplier relationships that are loosely managed or benignly neglected by the buying organization.
Companies are becoming more dependent on a complex supply base. In many cases, key processes and functions have been outsourced and the supply base has collapsed due to strategic sourcing projects. This complex “virtual organization” type of structure begs for the need to drive performance improvements, manage risk, and efficiently manage supplier relationships. These Supplier Relationship Management (SRM) capabilities are being developed at top companies who are reaping the rewards of their investments. These capabilities include supplier management development, processes, governance mechanisms, and systems to manage suppliers on a day-to-day basis over the supplier life-cycle (onboarding to exit).
The SafeSourceIt™ Supplier Database is one the largest eSourcing supplier databases in North America with over 427,000 suppliers. The database contains global suppliers with over twenty-five unique certification standards that are supported by our best practice initiatives such as GFSI, ISO 22000, Green Seal, ECO-LOGO, Fair Trade, SQF, and Certified Humane Raised & Hand-Fed.
In order to achieve maximum savings when using an e-procurement event, you need numerous suppliers aggressively vying for your business. SafeSourcing customers can request summary or detailed data from the same tool and download it to a variety of file formats.
We at SafeSourcing can provide you with quality, vetted suppliers with the ability to fulfill all your specific category needs. Even more, we can assist in certification identification of all of the suppliers. This way, if you have partnerships with existing suppliers or are looking at new partnerships, you can remain compliant with their practices. Once certified suppliers are located, SafeSourcing can provide the opportunity for price compression, making your category financially attractive, as our historic ROI is greater than 10x.
For more information on how SafeSourcing can assist you in exploring your supplier relationship management and procurement solutions for your business or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.
We look forward to your comments.