World class purchasing with best practice approaches to supplier management

Supplier relationship management is one of the key elements in building up flexible company networks. Efficient supplier management leads to competitive advantages and substantial savings. To achieve this, the right suppliers have to be selected and developed towards a "perfect fit".

A survey by Roland Berger, of 1,900 companies in Europe and South America, clearly shows that many companies have recognized the strategic importance of supplier relationship management. However, less than half of the companies select and develop their suppliers systematically. Only 37% integrate their suppliers.

Leading industries are automotive, electrical engineering, optics, electronics, and mechanical engineering.

Key success factors are supplier systematization, performance gap analysis, systematic supplier evaluation, and electronic supplier links.

Achieving best practice

Companies can be categorized according to five development stages: best practice, follower, basic, awakening, and low performer. The biggest lead is generated by using supplier links and by integrating suppliers. To achieve best practice, a company must set itself clear and ambitious targets and develop the structures for successful interaction with suppliers.

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