When it comes to best practices on the supplier management front, there are a few tried, tested and proven strategies that stand out.
Factors such as geography, regulatory compliance and sector-specific issues are just a few of the things you’ll need to be mindful of to make the most of your supplier management efforts. You’ll also have to be mindful of the fact that no two suppliers are the same, which means that some across-the-board initiatives — such as cost reductions — might have to be abandoned and replaced with a strategy that appreciates that each supplier is different.
This blog post will focus on three beneficial supplier management strategies to follow in today’s business environment. Incorporating them into your overall game plan will lead to mutually beneficial customer-supplier relationships that have the appropriate checks and balances.
Judge suppliers based on high-quality benchmarks
One of the most beneficial supplier management strategies involves managing your suppliers based on consistent, top-quality benchmarks.
Without this measure in place, you run the risk of having suppliers whose quality standards alternate between acceptable and below standard. You therefore need to come up with consistent standards and communicate these standards to suppliers so that both sides understand what is expected of the other.
Establish a program to assess suppliers’ performance
It would also be a good idea to develop and roll out a program to assess all of your suppliers’ inbound orders. The reason this is important is that such programs more often than not lessen incidents of shipments of flawed raw materials, cut down on erroneous orders and reduce late deliveries.
These programs are also important because they stipulate corrective actions to be taken in the event of non-compliance with the supplier-customer partnership. Evaluations based on the program can help with benchmarking, as well as with corrective measures.
Systems should solve problems, not cause them
Beware of legacy solutions that present nothing but problems. These systems can, if you’re not careful, hamper the process of monitoring quality management as well as compliance. Since you don’t want to fall behind your rivals, you need seamless integration of quality management, pricing, supply chain and other relevant systems.
Again, legacy or in-house systems may, unfortunately, get in the way of the supplier-company relationship. So make sure your systems are truly solutions rather than merely problems.
Don’t get caught sleeping at the proverbial wheel. Your suppliers are important to the orderly functioning of your business, so it makes sense to consider beneficial supplier management strategies to implement.
For more information on how these systems can help improve the efficiency of your company, talk to our team today!
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