As every procurement team will testify, it can take a bit of time to appoint a supplier for a mid-to-large sized project. It's hard to put an exact number on it, but a quick online search shows the stereotypical RFI/RFP process can take up to 3 months.
Using smaller, lighter, statement of works as a work delivery model needs to be much simpler and much faster to deliver productivity and agility benefits.
In this guide, explore:
- The benefits of using a network of vetted suppliers to get work done faster
- How to apply basic ABM principle to keep suppliers engaged
- Where tailspend SOW software can help with supplier engagement
Benefits of using a network of vetted suppliers to get work done faster
There are a number of productivity, agility and cost-management benefits of working with a network of vetted suppliers, via a tailspend SOW management platform.
Reducing time to start projects
One of the major delays in large projects where a tendering process is involved, is the administration of tendering process itself. Each stage (RFI, RFP, etc) requires sufficient time for the project/procurement teams to create the requirements and for the shortlisted vendors to respond.
Pre-vetting suppliers for projects of a given type (size, location, type of deliverable), allows this administrative effort to be front-loaded. This means, once vetted, suppliers are primed and ready to start delivering work.
In addition to pre-vetting suppliers, tailspend SOW management platform can speed up the process by:
- templating the creation of project briefs
- providing structured templates for supplier responses, including milestones
- automatically matching suitable suppliers with project briefs
Improved quality of deliverables
The milestone related invoice controls in a statement of work provide a high degree of confidence (or leverage) that work will be completed to the required quality and specifications on time.
More accurate budgeting and project forecasting
A SOW's milestones also provide a useful device for organisations to forecast their resourcing spend over a given period of time.
In addition to the benefits for the procurement and project teams above, there are similar, mirrored, benefits for the supplier too: projects can start quicker, there certainty about the project's scope and required outcomes from the beginning, and there is a forecast of revenue.
Using ABM principles to keep suppliers engaged
ABM or 'Account Based Marketing' is marketing strategy organisations can use to develop, grow and strengthen its customer relationships.
The principles are:
- Identify and group your customers into segments. E.g., short-term growth, long-term strength
- Research these segments to understand what interests and motivates them
- Communicate your opinions, long-term solutions and plans that match their interests and motivations
The principles of ABM can be equally applied to developing, growing and strengthening relationships with suppliers:
- Identify and group your suppliers into segments.
- Research these segments to understand their strengths and capabilities
- Communicate your opinions, long-term requirements and plans that match their areas of strength
For example, your supplier focused ABM strategy could be to leverage volume-based discounts by awarding more type of projects to suppliers who consistently deliver projects on time and on budget.
Where tailspend SOW software can help with supplier engagement
In the longtail of smaller, lightweight SOW engagements, the number of suppliers an organisation will want to manage will require a software solution.
Modern tailspend SOW engagement software can improve supplier relationship management at scale in a couple of ways:
Better segmentation and understanding of important supplier relationships
Quantitative (budget vs spend, deadline vs delivery) project performance data combined with qualitative (user generated ratings and reviews) provide detailed insight into the different 'types' of supplier that exist in your network. Using this insight, you can identify the groups of suppliers where there is an opportunity to either grow or strengthen a commercial relationship.
Talon can then turn this data/insight into curated supplier lists, which can be used for creating and targeting communication campaigns.
Automated, personalised, communication campaigns
Using your insight-based supplier lists, you can create and schedule a series of personalised email campaigns over time. An additional benefits is with every email campaign, you get real-time feedback on the relevance of the content you are promoting, which helps you further refine your supplier communication strategy.
Ongoing engagement ensures your network of suppliers stays ready to respond to smaller SOW projects as well as improving long-term commercial agreements. However, to effectively understand, segment and nurture relationships with a large number of smaller suppliers, organisations have to rely on a modern tailspend SOW platform.