2016 Supplier Management Trends and Predictions
December 22, 2015
2015 has been a great year for Trade Interchange, with the company growing rapidly and employing more people at our hub in Stockton. We have started working with many new prestigious clients, including Whitbread, The Restaurant Group and Wickes to name a few, and have also seen many exciting developments on our ARCUS® platform. But as 2015 draws to a close, we look at where we think Supplier Management is heading for 2016 and our predictions for the year ahead….
1. Performance management on a bigger scale
A big trend for 2016 is the importance companies place on the management of supplier performance. We expect to see companies looking to proactively and efficiently evaluate larger volumes of suppliers to improve supplier fulfilment and relationships, whilst minimising supplier risks and ensuring compliance.
Key to this will be integrated software, which will allow procurement teams to easily define, measure and act upon performance metrics to drive improvements against critical KPIs. Effectively leveraging supplier performance data will be crucial to helping companies make more informed sourcing decisions and drive collaboration between suppliers and stakeholders.
2. Compliance remains key
Effectively managing risk continues to be high on the agenda for procurement in 2016. Visibility over suppliers and their critical information will remain key to ensuring compliance and improving risk management strategies.
We envisage that companies will place greater focus on ensuring robust procedures and audited processes are in place to give evidence of best practice and security surrounding the protection of the business and brand. We expect to see companies putting more emphasis on developing their supplier management programme and extending the volume of suppliers they manage. Integrated contract management systems will ensure contractual information is adhered to and supplier performance metrics will be put in place to ensure important KPIs around compliance and risk are also met.
3. Greater organisational alignment
As procurement’s profile within business continues to grow, it will be a necessity for the function to develop stronger organisational alignments in order to progress further. Procurement must focus on improving companywide relationships to deliver the right kind of value that has a measurable impact on the business.
Supplier Management software has a role to play here, and we predict organisations will look for more complex workflows to allow for greater collaboration across departments. A centralised system will help ensure visibility of information is accessible to all stakeholders and more flexible reporting will allow data to be integrated across the business.
4. Integrated platforms
As supplier management systems become more familiar, we believe 2016 will see a focus on the integration of systems and the synergy of data. Using a central platform to manage the complete cycle of supplier information provides procurement with a much smarter tool to drive procurement strategy. The consistent process improves efficiency and companies gain an invaluable insight into their supplier base to reduce the costs, risks and complexities associated with managing a large supplier base.
5. Procurement will become truly valued at board level.
Senior management will, at last, realise how vital procurement is to the success of the business. They will treble departmental budgets, increase headcount, and double all buyers’ salaries. To say thank you, they will take the whole department to South Africa on safari as well as two ski trips.
Merry Christmas to you all!
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