Getting Creative With Suppliers: Extracting More By Engagement, Not Extortion (Part 2)

Please click here for the first post in this series.

In the first installment of this series, we looked at a number of observations from a recent Supply Chain Management Review blog post considering some ways to engage suppliers more creatively. At the end of his insightful column on the subject, Rob Swanson suggests what we've come to believe is one of the key tenants of better supplier collaboration and development. Engage early, and engage often. As Swanson puts it, "Do not hesitate to engage your suppliers early in the process and ask the hard questions. Avoid the tendency to keep suppliers at an arm's length. Even if your company does not have a mature supplier management program in place, you will see great opportunities by opening up, sharing your pain points and demonstrating a desire to become partners in each other's successes."

More and more, we're seeing examples of better supplier relationships founded on open engagement and collaborative exchange rather than hoarding information and periodically strong-arming one way or the other (which suppliers can be equally as guilty of, such as not honoring contracts when raw material prices increase). There are three great ways to get started with tools to drive better relationships through frequent dialogue and information discovery.

First, if you're in the manufacturing world, look for tools such as Co-eXprise, Akoya, Siemens and others that can help bridge the gap between design/engineering, sourcing and suppliers by encouraging information sharing to make better decisions. Break down both internal engineer and procurement walls at the same time as blowing up supplier walls as well. Second, walk, don't run, to buy a sourcing optimization solution to replace or augment your exist RFP/reverse auction capability. And third, invest in a supplier management toolset focused as much on collaboration, performance management and supplier development as gathering and managing basic vendor details.

Of course tools are just tools. But at least they now can't give you the excuse not to try to change processes that have been broken in the past!

- Jason Busch

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