Have you ever had a supplier approach you with a new suggestion? What happened to it?
I’ve worked in companies where suppliers come in once or twice a year with offerings or ideas. Unfortunately, this is often a grossly unproductive way to spend an afternoon — the odds of a business benefit coming out of this process are pretty low because the relevant customer team listens but only occasionally chooses one to evaluate further. That’s why a coworker once described the successes that came from these sessions as “lightning strikes.”
Your suppliers are smart people, but in the process described above, they are usually guessing at your business needs. They have data, market analysis, technical knowledge, and a plethora of products in development. In the end, they are giving you what they think you want.
But what if they didn’t have to guess — what if they knew what you wanted in advance, and targeted their recommendations accordingly? If they did, they might be able to help you solve pressing business problems or achieve real progress on a new initiative. You would be utilizing their brainpower, an often overlooked resource, to accelerate business growth.
Why You Should Communicate Your Needs to Suppliers
Now think about your own company. As with any business, there are goals and there are constraints fed by competing divisions, departments, and brands all vying for their portion of the same pool of funds. Further, development teams have goals to create products and product enhancements that will resonate with customers.
Now, by engaging your suppliers, you can open a whole new pool of resources to ensure new products hit the mark. Anything you can do to share knowledge, strategy, and pain points will help your vendors direct their efforts in the right way. Which, in turn, will make them better partners by targeting their investment in people, equipment, and time.
Success in leveraging your suppliers more effectively requires two simple functions:
- Look internally. If you’re in procurement leadership, start by looking at your own objectives. Are your goals the same as what you’ve had for the last five years? Do they flow from the company strategy? If not, take the time to understand what your business leadership really needs — where the growth is projected, and where the pain points are.
- Look outward. Communicate with your existing suppliers, then consider the vast array of startups and point solution developers to see what new entities are available to you and what expertise they can bring to the table.
Connect your supply chain partners with your internal business partners and let the vendors hear directly from sales, marketing, and operations about what is most important to your company. Let them ask questions directly to the people who know the answers. When you take this approach, the guessing stops.
How You Can Punch Above Your Weight Class
If your employer is a household name, the supplier community is likely falling all over themselves to support you. But what if you’re not a household name? What if you are a small or mid-market company with suppliers who are more focused on their large enterprise customers?
In that case, the onus is on you to raise the profile of your company. Volunteer to speak at the supplier’s internal meetings. Visit their sites and get to know their executive teams.
Don’t be put off by differences in levels if you are an individual contributor and they are senior executives. Bring in your marketing people to share more information about your company. In this collaborative environment, you can share statistics on complaints and ask them to suggest modifications to will reduce issues; or share your strategic plan and agree on the resource commitment they will make to support it.
Your business may be small, but if you’ve captured the hearts and minds of the executive team at your suppliers, it won’t matter.
How Services Can Benefit, Too
It’s easy to see how this might work in businesses that create and sell tangible goods, but it works just as well in services, such as financial services.
In the past, I worked for a financial services firm, and failing to meet filing dates was an expense and an embarrassment. The solution for this came from a technology provider. In another firm, when a unit that managed clinical trials wasted time and money getting patient information to medical professionals across the globe, suppliers responded and helped deliver solutions. Once they understood the bottlenecks, those solutions followed.
Understanding more about customer strategy provides vendors with the perfect opportunity to engage with clients in a way that sets them apart and allows them to retain or gain new business. It is a win-win for both you and your suppliers. What better way to utilize their resources than to directly support a project that has a ready customer base? Wouldn’t your company be thrilled to know that a new product or product enhancement will have instant customers? It’s the same for your vendors.
Among your supply chain partners, you have a hidden source of talent that is often under-utilized. The extent to which you can leverage that talent, and apply it directly to your company’s goals, could be critical to determining success in achieving those goals — without the guesswork.
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