What is Return On Relationships?
January 13, 2016
Darragh Toolan
1 minute

The rate of change in today’s business environment is frenetic. In order to address this new reality, the nature of supply chain relationships must change fundamentally, and look towards a new horizon Return On Relationships.

For too long, organisations have based their procurement and supply chain activities around achieving incremental improvements. These businesses practices were drawn up during the industrial revolution and simply don’t stand up in today’s connected, technology driven procurement environment.

Myopic Metrics

Relationship success remains a fuzzy issue for most companies. Current business and supplier relationships tend to be focussed around measuring and managing metrics. These relationships also tend to be unidirectional (buyer dictating to the supplier). While these processes can produce incremental improvements their shortfalls are that they focus on past performance rather than future opportunity and do not facilitate multidirectional idea sharing and innovation between the partners.

It’s for this reason that Vizibl would like to introduce the concept of Return On Relationships (ROR).

Return On Relationships is a comprehensive, actionable, value-oriented framework that ensures organisations drive tangible returns and competitive advantage from their relationships with key partners.

Return On Relationships provides a structured approach that maps and measures the value deriving from commercial relationships among trading partners in a supply chain. The framework provides the basis for building a comprehensive, multi-directional, forward-thinking picture of relationship management activities and business success.

Return On Relationships reflects a cross-functional and cross-organisational approach, showing how different members of a supply chain can best contribute to relationship success and how this maps to corporate measures of success. It moves well beyond traditional supplier management tactics in order to establish an environment where innovation can flourish.

Our framework for Return On Relationships recognises that successful relationships:

  • Are key to sustainable competitive advantage
  • Are more than cost reduction and efficiency
  • Span functional and organisational boundaries
  • Acknowledge the intricacies of global businesses
  • Emerge, rather than result, from strict control

Approaching this new collaborative way of thinking with a structured process provides organisations with a roadmap to optimise and redefine their commercial relationships and positions their business for ongoing success.

To find out more about how your organisation readdresses the way it engages with its critical partners and suppliers and to move from incremental improvements towards transformational change download our Return On Relationships White-paper.

Return On Relationships

Head of Global Solutions @ Vizibl
One platform. Every device. All your commercial relationships.
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