Evolution of SCM Landscape
In the supply chain management space, in the past few years, a counterpart to the much evolved ‘customer relationship management’ has come to the fore. The new school of thought and action is supplier relationship management or SRM. This has attained significant momentum and leverage as a key tool of the Supply Chain Execution (SCE) discipline. It has been observed that the usage and deployment of SRM platform and techniques is more or less focused on the technology application, which has left the process end virtually unaltered.
Everyone agrees that SRM offers greater visibility to supplier transactions and also provides tools for automate processes. It can also provide feedback on performance metrics. However, it does not manage the automation of performance metric gathering or supplier feedback regarding performance compliance.
One key area of improvement in improving the whole supply chain management process is making the ‘performance metrics’ more robust. It seems to be a direct result of a supplier compliance program engineered by a well-defined plan that is effectively communicated with your suppliers.
The reason for fallout of such mechanism is the lack standardization of supplier compliance. For instance, if your business deals with many suppliers and not all of them are consistent in regards to supplier compliance. It could very well derail your supplier relationship information pool. A good example will be if most of your suppliers fail to comply even with the bar code standards.
In such a case, your business intelligence unit will encounter data gaps that would stall effective supply chain management decisions. Thus, having a robust and compulsory compliance platform has become critical to today’s business needs. The overall goal is not only to improve internal operational efficiencies, but to also build stronger supplier relationships.
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