The results of a comprehensive survey of Supplier Management in Financial Services have just been announced. The survey, carried out in the UK by CityIQ, looked at how City institutions manage their suppliers given the pressures in the current market.
Presenting the findings, Paul Wiltshire of CityIQ explained: “There were four key themes that came out of this piece of research:
- The concept of strategic suppliers is embedded – with nearly 90% of respondents reporting that strategic suppliers were key to achieving strategic and operational objectives and a whopping 97% being able to identify their top three strategic suppliers by value.
- Reflecting the importance of the relationship that exists between organisations and their strategic providers, 85% of respondents believe that managing the process is a job best done by business management with “skin in the game”.
- In addition, or perhaps because of these closer relationships, the majority of respondents report that suppliers are coming to them with innovative ideas for cost savings and / or service improvements. This is the norm with respondents saying they expect more from suppliers than was previously the case.
- But despite all of the above, achieving cost savings was still a priority, with an impressive 89% of respondents saying that they would attempt to re-negotiate a contract if they believed cost savings could be made.”
Summing up, Wiltshire concludes: “It’s a tough market and organisations are demanding much more from their suppliers. The relationships that are going to prosper will depend on being able to deliver value for money at an acceptable level of risk. More than that, suppliers will have to become increasingly proactive if they want to hold on to their clients. Strategic supplier relationships are clearly the area to watch – as if they get it right this is where organisations will derive best value.”