Which suppliers warrant a formal SRM programme?

Strategic and bottleneck suppliers, typically those where failure would significantly impact operations or that are hard to replace quickly, deserve the most intensive governance.

How often should supplier performance reviews be held?

Quarterly is common for strategic suppliers; monthly for high-volume or high-risk ones; annually or at renewal for lower-importance relationships.

What metrics should an SRM scorecard include?

Typically on-time delivery, quality or defect rate, invoice accuracy, responsiveness, compliance with contractual obligations and, where agreed, innovation contributions.

Is SRM the same as supplier development?

Supplier development is a subset of SRM: it refers specifically to investing in a supplier's capabilities to improve performance, whereas SRM covers the full governance, measurement and relationship model.

What is the risk of not having an SRM programme?

Without structured management, performance drift goes unnoticed until it causes disruption, contract renewals are handled reactively, and the organisation has little leverage or insight when supplier problems arise.

Supplier relationship management

The structured management of key supplier relationships to maximise value, performance and joint innovation.

Definizione

Supplier relationship management (SRM) extends beyond transactions to develop strategic suppliers through governance, performance reviews and collaboration. It aligns relationship intensity with supplier importance, protecting continuity for critical inputs while keeping commodity spend competitive.

Esempio

A hospital holds quarterly business reviews with its main implant supplier to track quality, lead times and joint roadmap items.

Perché rappresenta un rischio aziendale

Without structured SRM, organisations treat all suppliers equally regardless of criticality, leaving strategic dependencies poorly governed and performance issues undetected until they disrupt operations. Missed renewal dates, overlooked SLA breaches and unmeasured performance drift are common consequences of unmanaged supplier relationships.

Come gestirlo

Segment suppliers by criticality first, then apply governance intensity proportionate to strategic importance.
Set a regular cadence of performance reviews tied to SLA metrics and contract obligations.
Track contract expiry dates so renewals are negotiated proactively, not under time pressure.
Document agreed improvement actions and follow up against them at each review.
Build in exit and continuity planning for critical single-source suppliers before a crisis forces it.

Domande frequenti

Domande comuni su questo termine.