Invited paper
Supplier relationship management as a
macro business process
Douglas M. Lambert and Matthew A. Schwieterman
Department of Marketing and Logistics, Fisher College of Business, The Ohio State University, Columbus, Ohio, USA
Abstract
Purpose – Increasingly, supplier relationship management (SRM) is being viewed as strategic, process-oriented, cross-functional, and value-creating
for buyer and seller, and a means of achieving superior financial performance. This paper seeks to describe a macro level cross-functional view of SRM
and to provide a structure for managing business-to-business relationships to co-create value and increase shareholder value.
Design/methodology/approach – In order to identify the sub-processes of SRM at the strategic and operational levels as well as the activities that
comprise each sub-process, focus group sessions were conducted with executives from a range of industries. The focus groups were supplemented with
visits to companies identified in the focus groups as having the most advanced SRM practices.
Findings – The research resulted in a framework that managers can use to implement a cross-functional, cross-firm, SRM process in business-to-
business relationships.
Research limitations/implications – The research is based on focus groups with executives in 15 companies representing nine industries and
multiple positions in the supply chain, including retailers, distributors, manufacturers and suppliers. While all companies had global operations, only one
was based outside of the USA. Nevertheless, the framework has been presented in executive seminars in North and South America, Europe, Asia and
Australia with very positive feedback.
Practical implications – The framework can be used by managers and has been successfully implemented in large corporations. The view of SRM
presented involves all business functions, which extends the current thinking.
Originality/value – The framework includes all business functions and was developed with input from executives representing major corporations
with global operations.
Keywords Supplier relationship management, Supplier relations, Buyer-seller relationships, Competitive advantage, Cross-functional processes
Paper type Research paper
Introduction
Supplier relationship management is the business process that
provides the structure for how relationships with suppliers are
developed and maintained. Supplier relationship management
has become a critical business process as a result of:
competitive pressures; the need to consider sustainability
and risk; the need to achieve cost efficiency in order to be cost
competitive; and the need to develop closer relationships with
key suppliers who can provide the expertise necessary to
develop innovative new products and successfully bring them
to market. Significant benefits are possible from better
managing relationships with key suppliers. It has been shown
that integration of operations with suppliers can improve firm
performance (Swink et al., 2007; Singh and Power, 2009;
Flynn et al., 2010). An additional benefit of cross functional,
collaborative relationships with key suppliers is the ability to
co-create value (Enz and Lambert, 2012).
Sharing information can promote integration with suppliers
(So and Sun, 2010) and key metrics can be used to drive
performance (Kim et al., 2010) and align perceptions
(Giannakis, 2007). Higher levels of integration with
suppliers results in improved performance (Frohlich and
Westbrook, 2001; Rosenzweig et al., 2003). However, the
appropriate level of supplier integration will depend on the
relationship, and an effort should be made to identify a
strategy tailored to each relationship (Lambert, 2004; Das
et al., 2005). Also, integration of suppliers beyond the first tier
of the supply chain may increase firm performance (Lambert,
2008a, b; Kannan and Tan, 2010).
While research has shown that better management of
supplier relationships increases firm performance,
management needs a methodology to guide them in the
process of supplier relationship management. In this paper,
we provide a comprehensive, prescriptive methodology for
implementing the supplier relationship management process
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1359-8546.htm
Supply Chain Management: An International Journal
17/3 (2012) 337–352
q Emerald Group Publishing Limited [ISSN 1359-8546]
[DOI 10.1108/13598541211227153]
This paper is based on Chapter 3, “The supplier relationship management
process”, in Douglas M. Lambert (2008), Supply Chain Management:
Processes, Partnerships, Performance, Sarasota, Florida: Supply Chain
Management Institute, pp. 53-68. See: www.scm-institute.org
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