Supplier Management 101 (Part 1): Introduction [Plus+]

supplier network

Supplier management is simply the management of supplier-facing business processes throughout the lifecycle of a supplier. Many procurement organizations have historically used strategic sourcing as the core methodology by which supply bases are shaped and suppliers are commercially engaged. But sourcing by itself is just one episodic process in a much larger supplier management lifecycle. In response, many organizations have broadened their sourcing activities to a category management activity that transcends category sourcing and pushes upstream into stakeholder management and downstream into deeper supplier engagement. Additionally, as rationalized supply bases lead to larger suppliers that provide multiple categories, and as procurement organizations are increasingly seeking innovation and top line growth from key suppliers, supplier management is expanding beyond its traditional post-sourcing and post-contracting to become the default methodology to manage the lifecycle of suppliers within which these processes and other source-to-pay processes get executed. So, when we talk about “supplier management,” we are really talking about “supplier lifecycle management” because of this broader scope.

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