Spend Matters Compass Research: Series Four

Supplier Management is booming – or so some say. But what exactly is supplier management and how should we define and consider the category of solutions that comprise this segment from a technology perspective? Should we consider targeted supplier diversity, supplier risk and supplier on-boarding as individual initiatives and separate platforms or should they comprise part of a broader solution set? In our most recent Compass Series research brief examining supplier management, Spend Matters cuts through the confusion and noise of this nascent and fragmented market, describing, in pragmatic terms, how companies have come to define and consider supplier management solutions both individually and collectively in the areas of risk, diversity and corporate social responsibility (CSR).
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We know that for many procurement, supply chain and finance professionals, the supply risk landscape looks awfully confusing. Software providers want to sell tools; content providers want to sell data; people want to advise or consult; insurance companies will now underwrite named sources of supply and facilities. Still further, many promise various combinations of all of the above. In short, it’s a market bazaar, even for the initiated. This Spend Matters Compass Series will lay out a framework to help sourcing professionals better answer these questions (though we can’t answer them entirely, as each situation is unique). We’ll also discuss many of the providers in different areas of the market that one may wish to consider and be aware of.
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In a broader procurement and supply chain initiative context, most organizations give supplier scorecarding, performance management and development short shrift. Even within sub-portfolio areas such as supplier information management/ supply base management within purchasing and operations (comprising supply risk management, supplier performance management, supplier diversity and green/CSR supply chain, among other areas), companies often relegate scorecarding and supplier development programs to the back burner relative to other priorities. Or they carry them out in a very limited capacity because of a single enthusiast or proponent, but there is a lack of company-wide support. This Spend Matters Compass Series analysis will first examine why supplier scorecarding and vendor management programs often come up short. We will then examine tips and tactics for designing and rolling out these programs to achieve lasting returns and look into the importance of incorporating both qualitative and quantitative metrics into a scorecard. Finally, we will share two case studies from the field and provide recommendations for implementing and enhancing scorecarding and development programs.
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This Spend Matters Compass report explores recent trending in the supplier management market (i.e., supply risk management, supplier performance management, CSR/compliance management, supplier diversity, P2P on-boarding, supplier development and other related areas), including the core supplier management capabilities of SAP (we'll leave our specific observations of Oracle for an analysis in 2012). We include a review of SAP's latest product as well as how the product (and which versions) are being deployed operationally in the field today. The second part of this analysis focuses on general deployment pitfalls to avoid regardless of which provider you've opted to go with – ERP or otherwise.

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