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CHAPTER 5
SUPPLIER RELATIONSHIP MANAGEMENT
taxes associated with importing goods from abroad. Facilitation fees as well as
other frustrating obligations associated with international procurement are also
eliminated, thereby streamlining the procurement process.
Local suppliers are also in close proximity. This makes it easier for the buyer
organisation to execute site inspections, supplier development programmes
and other contract management interventions. Close proximity reduces the
length of supply chains, which reduces risks associated with the uncertainty
and unpredictability of delivery schedules. Proximity also reduces the amount
of fossil fuel used and consequently carbon-dioxide emissions as well as less
packaging during transportation of goods, which results in significant cost
savings for both the buying and supplying organisations. Finally, the use of
local suppliers reduces the number of middlemen/brokers used in the process.
This reduces supply costs and the risks associated with the use of middlemen
in the procurement process [14].
5.8 CONCLUDING REMARKS
The supply chain topics of supplier relationship management, supplier
development, supplier base localisation, the BBSDP and buyer-supplier conflict
management were discussed in this chapter. These discussions focused on the
theory underpinning the concept, with the intention of giving the reader a solid
overview. In addition, current best practice in the examined topics received
emphasis. This was meant to give the reader some practical suggestions on
how programmes linked to these topics could be initiated and implemented.
In all cases, evidence was given on the benefits and drawbacks of each
concept. Benefits were mentioned to provide motivation for the adoption of
these programmes; whereas drawbacks were mentioned to enable the reader
to take steps to avoid or minimise associated pitfalls when these programmes
are implemented in organisations.
Information provided on each topic also enables those involved in these
programmes to weigh up the positive aspects against the potential negatives
in each case. This will allow them to make decisions in advance for the benefit
of the organisation.
The discussions throughout the chapter emphasised that these topics are critical
for the prosperity and long-term success of any organisation. The challenge
remains for supply chain practitioners to ensure that these programmes are not
neglected and that their conception and implementation is efficient and effective.
5.9 REFERENCES
[1]
Gartner Consulting, SRM, Enterprises drive competitive advantage
through SRM, White paper prepared for PeopleSoft, San Jose, 16 April
2001.