State of Flux has launched its dedicated survey to guide the upcoming 17th annual global Supplier Relationship Management (SRM) Research report. Renowned for its comprehensive examination of supplier relationships, this report seeks to differentiate between traditional supplier management and the more nuanced approach offered by SRM.
As noted by a Spend Matters analyst in 2022, there is a crucial distinction to be made; many companies engaged in SRM practices often conflate it with mere Supplier Management. The latter treats suppliers as commodities rather than partners, overlooking the potential value that can be derived from robust, collaborative relationships. Such a narrow focus not only deprives organisations of innovative solutions but can also negatively impact end-customer experiences.
Last year’s report prominently featured the concept of “Return on Relationships,” emphasising the procurement process’s influence on supplier engagement and its ripple effects on customer satisfaction. The findings were striking: suppliers contribute significantly—up to 50%—to the end-customer experience. For instance, organisations exhibiting high performance reported that 68% benefited from increased customer satisfaction through their SRM initiatives. In contrast, only 27% of lower-performing counterparts saw similar non-financial gains.
This year’s report shifts its focus to the theme “From Customer of Choice to Customer Delight,” aiming to explore how fostering strong supplier relationships can directly enhance the end-customer experience. The premise is simple yet profound: organisations that position themselves as preferred customers often enjoy better financial terms, while their suppliers are incentivised to deliver higher quality products and manage disruptions more effectively. Essentially, by nurturing relationships on one end of the supply chain, organisations can significantly improve service delivery on the other.
To enrich this year’s report, State of Flux is calling on procurement professionals to participate in the survey, which requires approximately 20 minutes to complete. Participants will receive a benchmark of their supplier management performance against global peers, along with a personalised report that includes insights from supplier management experts. Additionally, those who engage will gain exclusive access to in-person SRM Summits in London, Chicago, and Melbourne in the coming months.
The growing importance of SRM cannot be overstated; it is increasingly recognised as pivotal in optimising supply chain operations. Best practices in this area include building trust, conducting regular performance evaluations, and engendering collaborative relationships with suppliers to drive innovation and efficiencies. Many organisations are beginning to understand that effective management of supplier relationships can lead to improved collaboration and cost optimisation, as highlighted by various industry analyses.
Moving beyond legacy procurement strategies is crucial for staying competitive. Key attributes of successful SRM programmes include establishing a well-defined charter, segmenting suppliers appropriately based on criticality, and ensuring stakeholder buy-in. This broad-minded approach fosters a culture of continuous improvement, accountability, and innovation, ultimately translating to better business outcomes.
As the State of Flux survey remains open until 1 July 2025, the emphasis is on the need for cross-functional engagement within organisations. By leveraging insights drawn from supplier relationships, procurement professionals can better align their practices with market demands and ultimately enhance the experience for their end-customers.
The dynamic interplay between suppliers and customers makes understanding and managing these relationships critical. As the landscape evolves, the potential for SRM to act as a driver of value and satisfaction continues to grow, underscoring the importance of robust practices in this area.
Engaging in this dialogue not only benefits individual organisations but also contributes to a more sophisticated understanding of procurement strategies and supplier collaborations in the broader marketplace.
Reference Map
- State of Flux’s SRM Research report launch
- Analysis of Supplier Relationship Management’s strategic importance
- Insights on the evolving role of SRM in value creation
Source: Noah Wire Services
