At the heart of all we do at Supply Pilot is a belief that supplier engagement enables businesses and their suppliers, to achieve more, together, on-time and right first time. Recently, I found myself in a discussion with one of the Product Lifecycle Management (PLM) software providers we work with and he asked me “Why is supplier engagement so important to deliver change?”
My answer was in two parts.
Suppliers are a ‘force multiplier’
The first is that every sustainability, or procurement team (or indeed any team) is resource-constrained. It is a commercial reality. And therefore, if you can enable and empower suppliers, they become an extension of your team.
They are your producers. They are your developers. They have the specific domain expertise in their product or category.
And so, we draw many parallels between supplier engagement and employee engagement. In recent decades, most companies have transformed employee engagement to empower their teams better.
Better communication. Better support. Increased transparency around performance.
Supplier engagement applies the same philosophy to your suppliers. Here at Supply Pilot, we champion the three pillars of supplier engagement: communication, transparency and support.
From a supplier’s perspective: what are we doing and why? (Communication). How am I doing against those objectives? (Transparency). And how can I improve? (Support).
As one client put it, “supplier engagement means that suppliers are a ‘force multiplier’ to deliver operational efficiency and to deliver change”.
Be inclusive, that means 100% of your suppliers
The second part of my answer was about inclusion. Supplier engagement is about all of your suppliers.
I appreciate that many organisations will use Supplier Relationship Management (SRM) methodologies to focus on the top N% of suppliers, or alternatively tier suppliers categorising which are ‘key’ and which are not.
Whilst that can be an important part of a broader supplier engagement strategy, to enable successful supplier engagement, you need to enable all of your suppliers…
If you make a specific product-level commitment e.g. leaping bunny, free-from, no artificial ingredients in your products by a certain date, then this means all of your products. Therefore, you need to engage all of your suppliers in that project or initiative.
If you commit to 100% recyclable, reusable or compostable packaging in your portfolio of brands, then this means all of your products. Therefore, you need to engage all of your suppliers in that project or initiative.
It may seem like I am stating the obvious, but many organisations will often Pareto the impact and start with the largest suppliers or the largest range (which in itself is not an issue). However, businesses cannot reach the ultimate objective unless all suppliers are on the journey.
Want to understand more about the benefits of engaging suppliers in your change and transformation journey? Get in touch with the Supply Pilot team today!
