Ingersoll Rand. Jonathan Kamanns Leader, Supplier Relationship Management

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2 Ingersoll Rand Jonathan Kamanns Leader, Supplier Relationship Management

3 Supplier Relationship Management Global Process Ownership What is Supplier Relationship Management (SRM)? Why do we need it - Benefits? Supplier tiers Key roles in governance Scorecard Actions log How do we ensure continuous improvement? Success deliverables Maturity in SRM SRM must be genuine!

4 What is SRM? Our suppliers influence our success the same way our own employees do; we have to define success. In alignment with our Value Proposition it is: A more formal & consistent management of our global and regional supplier relationships A more consistent collaboration with our regional suppliers with the goal of generating mutual value A structure for how regional & global supplier relationships are developed & maintained A way to foster continuous improvement and enable mutual strategic planning & benefit An enabler for additional leverage opportunities net yet uncovered A single-point of coordination between Company and supplier Supplier relationship management (SRM) is the discipline of strategically planning for, and managing, the post-contract interactions with our suppliers in order to maximize the value of those relationships and ultimately define our mutually beneficial successes.

5 Benefits of SRM Improved visibility and accountability of regional & global suppliers: Missing the mark Driving performance Better access to, and visibility of, regional & global supplier expertise not currently leveraged Mutual relationship-driven improvements and success Productivity Process Improvement Profitability Potential for regional & global suppliers to add resources and investment to keep costs minimal The supplier contract is a critical foundation, but success after the contract is our responsibility.

6 Primary, Secondary & Tertiary Suppliers Fleet Leasing/Management Driver Risk Management Fuel Maintenance Vehicle Logistics Telematics Remarketing Up-Fitting Branding/Decaling Collision Management Financing Prioritize

7 Supplier Tiers Tier 1 Top 10% High value strategic supplier Invest in growing relationship Quarterly Scorecard Tier 2 Next 20% Managed supplier Invest to growing relationship Bi-annual Scorecard Tier 3 Next 30% Non-Core but important More easily transferrable spend Annual Scorecard Tier 4 Next 40% Lowest impact No Scorecard Suppliers are segmented by not only cost but also on risk to the organization. Although high $ suppliers must be managed, high-risk suppliers should be equally managed

8 Key Roles in SRM & Governance Supplier Business Process Owner Business Process Administrator Supplier Relationship Manager Sourcing Delivery of product or service Industry Benchmarking Reviewer of relationship Ownership of deliverables, expectations & KPIs/SLAs Subject matter expert Reviewer of relationship Administrator of deliverables/expectations & KPIs/SLAs Day-to-day supplier interaction Reviewer of relationship Relationship Champion Coordination & Escalation point SRM Continuous Improvement Contract Negotiations with initial SLAs Participation in Business Reviews Reviewer of relationship

9 Responsibilities of Key Roles in SRM

10 Potential Business Process Administrators Fleet Human Resources Risk Management Environment, Health & Safety Legal Compensation & Benefits Procurement/Sourcing The Business Who should I include?

11 Scorecard Elements Service Level Agreements (contractual obligations) Key Performance Indicators (non-contractual improvements) Customer Satisfaction Innovation Quality Cost Speed

12 Example Scorecard

13 Example Actions Log

14 Continuous Improvement ID additional opportunities RIEs Projects Review SRM Level Reviewed twice a year against criteria (internal readiness) Continuous Improvement Supplier Relationship Management Relationship Strengthening Action Scorecards: Customer Satisfaction Innovation Cost Quality Speed Sustain & Manage Monthly meetings with business process owners & SRM Scorecard reviews with suppliers (external readiness)

15 SRM Success Deliverables Development of mutually beneficial relationships from primary through tertiary suppliers Regional & global supplier visibility and alignment Engaged internal & external partnerships in achieving both sets of business goals Extended influence on supplier s supplier(s) Delivery of maximum value & efficiency to internal customers with speed & precision Performance-driven deliverables relevant to continuous improvement Ensures that both parties have direct access to additional POC s Documented history of performance with alignment across the organization

16 SRM Governance SRM Policy SRM Playbook SRM Shared Site Templates Updates

17 SRM GPO Policy

18 SRM GPO Playbook

19 SRM GPO on BOS On-Demand

20 Supplier Meetings Template (5) Introductions (10) Cost Out Opportunities (20) Company Updates & Trends New Products, services, & technology Industry Updates & Trends Benchmarking (45) Review of Current Business Scorecards Action Plans / Issues & Resolutions Volume & Spend Locations Experience Sub-Supplier Review Project Status Update (20) Review Strategic Priorities (15) Next Steps, Takeaways, Action Items (5) Q&A

21 Q&A