David Atkinson on SRM – Show Them The Money!


How do you establish a Supplier Relationship Management (SRM) programme that truly works? In five videos we will be featuring this week, David Atkinson lays out the steps that are absolutely crucial to  SRM success. Atkinson is an ex CPO himself, and one of the most thoughtful writers, advisers and educators in our industry. He's a real expert when it comes to SRM, from a practical and theoretical standpoint, and is always worth listening to.

In his series, Atkinson previously discussed the importance of having a clear reason for doing SRM – he called it the over-arching purpose; and then the question of who benefits – what stakeholders are likely to be interested in from SRM. In this third video he talks about how CPOs ‘Show them the ‘money’.

He argues from the start, that this is not just about savings targets. Although challenging it may be – the focus must shift to a more mature discussion about value for money. CPOs have to work hard (and most definitely with the CFO) to define meaningful value-for-money measures. Cost reduction is a given, but what else are CPOs going to measure and manage as part of their SRM effort?

Once definitions of value have been agreed, then a mechanism for monitoring VFM improvements coming down the pipeline will need to be created, enabling the CPO to determine not only the aggregate benefits of SRM, but which SRM interventions with suppliers are the most effective.

Predicting which activities are going to yield the most benefits is an inexact science. That’s not to say, however, that CPOs shouldn’t keep count.

In the next video in this short series, Atkinson discusses what the CPO and the team need to be good at. What are the critical processes that deliver the tangible benefits to the business and its stakeholders? In other words, what is the SRM ‘day job’? And if you want to discuss these issues further, you can contact him through his website at Four Pillars Consulting.



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