Flourishing supplier relationships can transform healthcare organizations. Samer Haddad, shares his experience of building and navigating successful partnerships with Jim Cagliostro. Episode Introduction Samer explains why trust is the foundation of all successful supplier relationships, the importance of human-to-human connection and why a partnership sometimes means giving your partner the benefit of the doubt. He also outlines the key to a successful exit strategy (plan, plan, and plan) and why solid leadership means treating others as you want to be treated, and leaving your ego at the door. Show Topics Supplier relationship management isn’t just a keyword Trust is the foundation of successful relationships Managing multiple suppliers is about more than spend ‘’Partnership is a partnership’’ Managing a successful exit strategy Leadership tip: keeping your ego out of the way 04:33 Supplier relationship management isn’t just a keyword Samer explained how the impact of Covid revealed the importance of strong supplier relationships. ‘’When the world went into COVID and all the crises that came after that, in terms of shortages and everything, I can make a pretty easy judgment that there was a big differentiator between companies who made it and who maybe struggled mainly was supplier relationship management. Because when the real challenge came to the world, companies that invested in relations, companies that had deepened their relationships, especially with the significant suppliers to their production or to their delivery, whatever that is, made a difference. Those were the ones who were able to actually leverage that challenge to their benefit in the market. So they gained market share. The ones who had superficial relations, maybe more towards purely commercial kind of dealings, I think they struggled because, at such a moment, that kind of... I can't call it a human-to-human relation, or personal relation is where things are tested, and when companies need to make decisions, that's always an element. The trust between those organizations is essentially trust between humans that are doing business for years together. So if you just... we learn from the past two to three years it is I think many of my peers in procurement supply chain will vouch to the importance of supplier relationship management in general and not just like a keyword that you use and throw around…’’ 07:09 Trust is the foundation of successful relationships Samer said KPIs can help to measure progress and build trust. ‘’It takes time to build up that trust. So it is very important when we start a relationship that we create the proper agreement because this is why contracts are there. Contracts manage the relationship between parties. And you're establishing basically a baby kind of relation that has no trust yet, and you need to monitor it and start putting in the building blocks of that relation. Usually, in my opinion, that is established by having mutual mechanisms to judging how companies are engaging with each other. That could be the KPIs that you set. And it's not fair only to set a KPI for the supplier that you're establishing a relationship with, especially if you're looking long-term. Some KPIs should be set, maybe not in the contract, not necessarily, but self-imposed as you manage that important relationship that you know about. So you can even monitor internally how you're engaging with that supplier. Now, if you do that kind of fundamental layer of developing that relationship and you start building upon it, with time, trust starts getting improved and starts growing. It's like a baby, and it grows. It becomes an entity.’’ 10:24 Managing multiple suppliers is about more than spend Samer said organizations need to understand how suppliers can impact their business. ‘’…... But let's say what are the top 10 suppliers that basically can make or break your business? Because each business needs to know these kinds of suppliers. What are the suppliers that, if they don't deliver, you're going to have challenges actually delivering to your customer, or it'll affect your quality, or it might basically put you in a different pricing position in the market, which could basically hurt your business? So you need to understand those really well. And what I see as a common mistake is people treat category management as just a function, just an area. Like supplier relationship management. "Oh, you're a procurement person, so you do the procurement, invoicing, all of that. And by the way, you need to just take care of categories. Also, take care of the supplier relationship." It doesn't work. So especially when it's big business, when there's lots of money being moved around, you need people to focus on those suppliers and those categories. So I would recommend that you really understand the suppliers that drive the goals of your business and, at the ...
