Suppliers are now crucial strategic partners that support product innovation, efficient supply chains, and overall competitiveness. They are no longer just vendors of goods and services. Treating suppliers as essential partners in the field of direct spend management—almost like customers—can be a key component of a successful company strategy. We remind why suppliers are critical for supply chain success and what CEOs and business leaders can do to improve supplier relationships.
Four key reasons why suppliers are critical for managing direct spend
Checklist for business leaders to build supplier relationships and enable adaptive supply chains
By shifting direct spend management from a transactional function to a strategic partnership with suppliers, companies can build more resilient, innovative, and adaptive. Below is a checklist of key actions to follow:
Dedicate Time to Supplier Relationships
Initiate One-on-One Conversations with Supplier CEOs
Work with Direct Spend Suppliers to Develop Mutually Beneficial Opportunities
Make Strategic Commitments During Supply Chain Disruptions
Adopt a Holistic Direct Spend strategy
Focus on Long-Term, Strategic Partnerships
Embed Procurement into S&OP Processes
Leverage Data and Digital Tools for Supply Chain Collaboration
Develop Resilience and Risk Mitigation Plans
Case in Point: Global distributor gains improved invoice accuracy and faster payments as a result of PO Collaboration with their customer.
Implementing a Supply Chain Collaboration solution has transformed the way an industrial distributor of fasteners, hardware and miscellaneous supplies operates, addressing a critical pain point: the sluggish response to purchase orders (POs). Previously, the reliance on a manual, email-based system often left salespeople overwhelmed and slow to respond to POs, leading to missed opportunities and frustration for suppliers.
With the integration of CXML and the enhanced point-of-sale systems, this challenge has been tackled head-on. Now, salespeople have a clear expectation and streamlined process for responding to POs promptly. This newfound accountability not only accelerates response times but also significantly improves invoice match accuracy. By ensuring that POs are handled directly through the point-of-sale systems, salespeople can accurately align invoices with the corresponding orders, minimizing errors and discrepancies that once plagued the invoicing process. This dramatically improved financial accuracy and reduced revenue leakage.
Moreover, this solution offers substantial value for suppliers. The integrated system allows them to manage all facets of their procurement seamlessly, reducing manual effort and boosting overall efficiency. By fostering prompt responses and enhancing accuracy, the collaboration solution transforms procurement from a source of frustration into a streamlined, effective process for greater success in a competitive marketplace.
Nari Viswanathan is Sr. Director of Supply Chain Strategy at Coupa, where he manages the Go to Market strategies for areas of Supply Chain and Direct Spend. Nari Viswanathan is a six times SDCExec Supply Chain Pro to Know award winner. Over the past 20 years, Nari has held VP and Director of Product Management, Research and Marketing roles at various companies such as E2open, i2 Technologies and Aberdeen Group. He is a proven B2B marketer with expertise in content marketing, competitive intelligence, and positioning.
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