Trident ConsultingTrident offers training, consulting and recruiting services to business professionals.

Marketing and sales executives long ago recognized the importance of developing and maintaining strong relationships with their clients. After all, people buy product, not companies. A sound relationship fosters trust and builds customer loyalty. Hence, the emphasis on Customer Relationship Management (CRM) programs.

Many traditional supply chain managers view relationship building as the sales person’s responsibility. (We are the customer!). However, the dynamics of the business environment have changed dramatically, and the customer is no longer always right. Contemporary supply chain managers are now faced with constrained markets and intense competition to secure capacity. As technology advances and products become more complex, supply chain managers are increasingly relying on their suppliers to assist in new product introduction and development.

Business leaders are realizing that competitive advantage must be gained by constructing supply networks that deliver value to the end users of their products. The only way to secure these networks is to engage key suppliers in much the same way as marketing and sales professionals engage their key customers. This means focusing on the development of the relationship by implementing Supplier Relationship Management (SRM) programs.

By building sound relationships with suppliers, supply chain management professionals foster loyalty and secure valuable support that goes beyond the terms & conditions of an order, or the contents of a contract. These efforts can be literal life savers in some cases. Take for example a business that runs into cash flow concerns, and turns to its supplier-partners for short term extension of payment terms. If the supply chain manager has fostered a healthy relationship focused on cooperation and partnering with his or her suppliers he should be able to reach a deal that satisfies both company’s needs.

By engaging suppliers in an SRM program that seeks to develop the relationship beyond the purely transactional, companies may realize true competitive advantage in their supply chains.