JAKAMO
WHAT IS SUPPLIER EXPERIENCE and why should every executive care about it?
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Jarl Matti Anttila
Timo Rossi
Anssi Uitto
CMO AT JAKAMO
CDO AT JAKAMO
CEO AT JAKAMO
M
ost of the executives are already familiar with the concepts of Customer Experience, Employee Experience and User Experience. There is no doubt that they all are significantly important for companies’ success. But how many have ever heard or thought about Supplier Experience? And why should every executive care about the Supplier Experience?
THE END-CUSTOMER WILL SEE THE OUTCOME OF POOR SUPPLIER EXPERIENCE
Today in a manufacturing context, the products are produced in global and complex supply chains. Companies are very depended on the performance of their procurement and suppliers in many ways, for instance: • Costs – purchases from suppliers can cover up to 80 % of the company’s cost structure • Quality – suppliers play a key role in fulfilling the quality of the deliveries to the end-customer • Shortages and delays in suppliers’ deliveries can cause serious problems • Technology – suppliers are developing and delivering crucial technologies that are difficult to substitute The Covid-19 pandemic has shown us how vulnerable companies can be when suppliers cannot deliver the essential components on-time, or at all. Therefore, it is important to think about why your suppliers would serve you over other companies generally, and especially, in a state of emergency. Customer companies, especially the purchasers, need to solve the challenge of how they could improve their relationship
with suppliers and become their preferred customer. This should not only be on the agenda of procurement but rather prioritized by the whole company management – because the end-customer will see the outcome of poor supplier experience. Even so, the importance of suppliers for a company’s overall performance is often overlooked, or if not totally forgotten. Many supply-chain-related problems could be avoided by taking a holistic view in managing and developing supplier relations bi-directionally both at the operational and strategic levels. According to our research in the manufacturing industry, the typical topics causing problems in customer-supplier-relations are: • Lack of strategic cooperation i.e. common targets and open governance • Manual time-consuming processes and non-existent operational transparency • Poor cross-organizational communication and interaction • Silo-type of thinking in value chains
THE CONCEPT OF SUPPLIER EXPERIENCE
For solving these problems and improving the company’s overall performance it is essential to recognize the value of the suppliers. We want to take this in the loop by introducing the concept of Supplier Experience. It is holistic by its nature and approaches customer-supplier relations from the viewpoints presented in the picture beside.
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