More and more businesses are turning to their suppliers to help innovate their own business models, the products and services that they offer customers. These key actions are needed to ensure your business is in the best position possible to maximise supplier innovation.
Businesses at the forefront of innovation, have over the years changed their approach to supplier relationships. Their focus has moved away from one of cost savings to value, and with this the desire to drive more supplier innovation. The likes of Unilever, P&G and Walmart are leading the way when it comes to supplier innovation and follow many of the rules mentioned below.
- Encourage ideas from suppliers as they often know your business better than some of your own team, and ensure you give them a medium to share these ideas.
- Promote your commitment to the supplier innovation programme. This commitment should come from the entire business
- Nurture ideas with suppliers and establish a culture of trust, so suppliers know you respect their IP.
- Share as much information as you can with your top suppliers. The earlier suppliers can see your product roadmap, the sooner they can provide ideas to improve it.
- Make sure you have a defined supplier innovation workflow letting your suppliers know how plans are progressing on a regular basis.
- Ensure your category managers hold all of their quarterly reviews, and action what is agreed.
- Pay your suppliers on time.
- Motivate your employees to collaborate with suppliers on new innovations, by mixing up their KPI’s and remind them it’s okay to fail.
- Embrace your suppliers as an extension of your business and treat them as you would like to be treated.