50 Shades of Supply Chain

From SRM to S&M and all of the gray area in between.

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It’s been defined as a practice involving dominance and submission, roleplaying, restraint, and other quirky dynamics.  That’s right, Supplier Relationship Management (SRM) can be a tantalizing dance in which – when everyone understands and performs their roles – both parties get what they want in the end.

As tempting as it is to think that SRM is about one party dominating the relationship while the other submits to what that dominant party wants, SRM is really focused on the process of optimizing the outcome of the relationship.


SRM shouldn’t be approached in a hands-off manner.  Effective SRM might require anything from the tickle of a feathery touch with your suppliers to whipping your suppliers into shape (from a quality or compliance or service standpoint). 

Supply chains can oftentimes feel like restraints – tying you down and forcing you to accept whatever punishment your suppliers are meting out.  But avoid the temptation to either submit to these restraints or to force a role reversal.  A supplier accustomed to a dominating role with its customers may not enjoy a more submissive role – or even understand how to let go of the leash (as the expression goes).

Instead of being gagged by your supply chain, an optimized SRM allows you to speak up for yourself – either to ask for permission or to get clarification on what your supplier wants from you.  Often, a supplier might require simple communication (forecasts, purchase orders, specifications, etc.) even though they may not know how to ask for it.

  They may wear an expressionless mask of apathy because they don’t know how to ask for what they need.  At the risk of being pinned down and put in your place, force them to hear what they need to hear (again, forecasts, purchase orders, specifications, etc.).

If – in the relationship between you and your suppliers – you are the one who plays the dominant role, don’t allow your authority and your control overwhelm your suppliers.

  In most cases, all your suppliers want to do is to please you.  You have to decide whether or not you let them know if you’re satisfied.  Many find it much more effective to withhold praise until you believe your supplier truly deserves it. 

Benchmarking your suppliers is an effective way to measure them and let them know – if they’re being bad (late deliveries, high costs, poor quality, etc.) – that they deserve to be punished (reduced orders, discounts, audits, etc.).  If they’re being good, however, don’t blindfold them or leave them in the dark.  You should reward them appropriately – by either giving them more business or taking the handcuffs off (metaphorically), if they had been punished for prior bad behavior.

Finally, if you are new to the world of SRM, you may want to approach it cautiously.  The discipline of SRM is fraught with temptation.  Resist the immediate urge to throw yourself into a dominant or submissive role.  SRM requires experimentation to be successful.  Follow your instincts to be curious and attempt various positions when dealing with your suppliers.

 SRM works best when you take on different approaches with multiple supply partners.  In fact, many supply chain managers can testify to the fact that they get the most out of their SRM programs when they have a large supplier base to work with.  This allows for various SRM positions, depending on the leverage and power of their various supply partners. 

Don’t let your supply chain bind you to a specific way of managing your suppliers.  Remember that – in the supply chain continuum – we are all customers and we are all suppliers.  In the same way that you’d want your customers to use SRM to optimize their relationship with you, you should see SRM as a tool to get the most out of your suppliers.    

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