What is SPM?

What is Supplier Performance Management?

Best practice Supplier Performance Management (SPM) is the formal process of measuring, analyzing and effectively reporting on supplier performance, managing pro-active relationships that drive continuous improvement and add value. When an SPM program is implemented and  managed correctly, it allows organizations to :

  • Maximize Time and Resource Efficiency
  • Align Supplier and Corporate Objectives and Processes
  • Alleviate Risk
  • Drive Corporate Ambition

The Performance Management Loop

Biznet Performance Managment Loop

The Performance Management Loop illustrates the steps of the continuous management process which drives an SPM program. The SPM process includes the management of actual performance, identification of performance gaps and attaining agreement of actions from suppliers to achieve desired performance levels.

How Benefits of A Supplier Performance Management Program Are Realised

As organizations focus on core value chain, outsourcing an average 70% of services and 80% of spend, success is intrinsically linked to the performance of suppliers and sub-contractors. An effective SPM program will ensure the benefits and requirements identified at contract award stages are delivered throughout the duration of the contract. Pro-active management, based on accurate, up-to-date information ensures operators and suppliers develop a collaborative relationship that develops efficiencies and drives competitiveness. Supply risk is averted through analysis of trends and automated alerts giving early warning of areas of concern that enables corrective action to be taken before an incident and its associated cost implications occur.

The Importance of Suppliers in a Typical Supply Chain Organization

70 80 90 Pie Charts

Biznet SPM Value Proposition:

Biznet have worked with industry leaders within the oil and gas industry for over 12 years. Our experience shows oil and gas organizations can expect to achieve the following benefits from implementing a Biznet SPM program within their organization:

Maximize Time & Resource Efficiency

  • Minimize inefficient data collection
  • Minimize administrative tasks
  • Drive forward-looking supplier review meetings
  • Empower managers to create value

Align Supplier/Operator Objectives

  • Grow strong supplier relationships
  • Benchmark performance and incentivize suppliers
  • Work objectively together
  • Drive innovation

Alleviate Risk

  • Identify trends and performance gaps
  • Take preemptive corrective action
  • Make timely strategic and tactical decisions
  • Support local content

Drive Corporate Ambition

  • Drive continuous performance improvements
  • Create a cooperative culture
  • Exceed expectations
  • Deliver extraordinary results