Though companies have long been interested in supply relationship management (SRM) as a way to control costs, compliance is becoming an increasingly important driver for their SRM initiatives.
This was reflected in a survey of 300 supply managers at a Procuri user conference earlier this year. The managers reported a desire to boost spend data visibility.
Increased transparency in the procure-to-pay process helps companies become more efficient -- and thus save money -- and also eases compliance efforts, says Capgemini's SRM capability leader in a recent interview with IT Business Edge.
Despite their stated desire to improve SRM, many companies find it difficult, he says, in part because they tend to put technology before people and also underestimate the need for user training.
A strong governance model and backing from senior management will go a long way toward reducing SRM woes, he says.
The eye on the prize: According to an Archstone Consulting survey, companies with SRM initiatives typically report reductions in procurement staff levels, as well as lower costs in delivery and quality control.
Conversely, a lack of attention to SRM can result in suppliers gaining the upper hand, says a Gartner analyst.