Art of Procurement

757: Is Supplier Relationship Management the Key to Procurement’s Success? W/ Oliver Jones

Dec 2, 2024

Oliver Jones, Director of Procurement at H&Z Management Consultancy, dives deep into the essence of supplier relationship management (SRM). He emphasizes how successful procurement relies on strong relationships rather than just contracts. Jones discusses overcoming common challenges in SRM, linking metrics like risk management and ESG to supplier engagement. He also shares insights on the ideal center-led operating model and strategic supplier segmentation, showing how prioritizing relationships elevates procurement effectiveness and drives overall business success.

34:37

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Episode guests

Oliver Jones

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Quick takeaways

Supplier relationship management is essential for procurement success, as it fosters value delivery through improved supplier engagement and operational performance.

A structured approach to categorizing suppliers by tiers enables procurement teams to prioritize relationships and ensure effective engagement with key suppliers.

Deep dives

The Importance of Supplier Relationship Management

Supplier relationship management (SRM) plays a crucial role in enabling procurement efforts to drive value beyond mere savings. It emphasizes the need for firms to engage suppliers effectively, which can lead to improved operational performance and risk management. In regulated industries like financial services, adequately managing third-party risks becomes increasingly important, requiring strong engagement with suppliers and a focus on building long-term relationships. By recognizing that significant portions of expenditure are tied to suppliers, organizations can shift their strategies toward valuing these relationships, ultimately enhancing their overall business performance.

Intro

2min

Diverse Pathways and Dynamics in Procurement Careers

2min

Elevating Procurement Through Supplier Relationships

7min

Strategic Supplier Segmentation

5min

Navigating Supplier Relationships in Procurement

16min

Building Effective Supplier Relationships for Successful Procurement

3min

“If you want to be a customer of choice, it's not going to come down to the contract, it's going to come down to the relationship, even at the individual level.” - Oliver Jones, Director (Procurement) for H&Z Management Consultancy

Procurement may be a highly tech-driven function – and growing ever more so by the day – but at its core, the quality of procurement’s relationships with internal stakeholders and suppliers ultimately determine their success or failure for the business.

In this episode, Philip Ideson speaks with Oliver Jones, Director (Procurement) for H&Z Management Consultancy, about why the “relationship” part of supplier relationship management (SRM) is vital for procurement’s ability to deliver value to the business. He also shares his perspective on how procurement can overcome some of the more common obstacles to creating strong relationships, but why, in the end, it’s well worth the effort – for procurement, for suppliers, and for the business in general.

They also discuss:

How multiple metrics of procurement’s success – like risk management, ESG, or value beyond savings – are all tied back to (and dependant on) supplier relationship management
Why the ‘center-led’ operating model is the optimal framework to enable successful supplier relationship management
Best practices for dividing procurement’s focus and prioritization among tier 1, tier 2, and tier 3 suppliers

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Art of Procurement

757: Is Supplier Relationship Management the Key to Procurement’s Success? W/ Oliver Jones

Episode guests

Podcast summary created with Snipd AI

Quick takeaways

Deep dives

The Importance of Supplier Relationship Management

Embedding SRM in Procurement Practices

Segmenting Suppliers for Effective Management

Navigating Power Dynamics in Supplier Relationships

Remember Everything You Learn from Podcasts