Success factors for strategic supplier partnerships


For strategic supplier partnerships to be successful, factors to improve internal collaboration have to be taken into consideration. These include full support by top management and cross-functional teamwork.

Top management support. Having the support from top management boosts the motivation among those who help manage strategic supplier partners and makes a strategic partnership more likely to succeed. Such involvement needs to go far beyond actually signing the contract itself. At many companies, buyers are still relatively subordinate and thus in need of support on strategic issues. This means management must ensure that the resources required, such as people, time, travel, technology and facilities, are available. In addition, management should remove any organizational obstacles and create a climate in which the customer’s and supplier’s staff can work together well. The level and intensity of such involvement depend on the relative size of the customer and supplier.

Cross-functional teamwork. Many successful businesses have emphasized the concept of using the coordinated expertise of teams. Cross-functional teams have also become a major success factor in procurement to minimize total cost of ownership and provide the best technical solution. To be effective, they should be put together at the earliest stage of identifying needs and should work throughout the entire procurement process. Experience shows hat bringing together different functions from within the firm adds considerably to the quality of decisions being made.

Companies with a high level of supplier management capabilities permanently look for opportunities to improve their strategic partnerships. Clearly defined goals shared by both partners – goal congruence, mutual predictability, and intensive communication between the partners are important success factors for the improvement of external collaboration and vital for managing strategic partnerships with suppliers.

Goal congruence. Strategic partnerships can work only if the partner’s strategies and visions of the future are compatible, and if those visions and strategies are constantly being reviewed and developed. The companies must be compatible both in terms of strategic and operative management and the approach to solving problems.

Trust. Interpersonal trust between the people inside both partner firms can be increased through regular face-to-face contacts. That way, it is easier to transmit tacit knowledge about interpersonal relationships, such as signals concerning commitment, likely behavior in conflicts, or the perceived value of the relationships.


About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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