What is Supplier Relationship Management?

Supplier Relationship Management

Supplier relationship management (SRM) is a discipline of working collaboratively with those suppliers that are vital to the success of your organization, to maximize the potential value of those relationships.

Supplier relationship management is a comprehensive approach to managing an enterprise’s interactions with the organizations that supply the goods and services it uses. The goal of supplier relationship management (SRM) is to streamline and make more effective the processes between an enterprise and its suppliers just as customer relationship management (CRM) is intended to streamline and make more effective the processes between an enterprise and its customers.

SRM includes both business practices and software and is part of the information flow component of supply chain management (SCM). SRM practices create a common frame of reference to enable effective communication between an enterprise and suppliers who may use quite different business practices and terminology. As a result, SRM increases the efficiency of processes associated with acquiring goods and services, managing inventory, and processing materials.

According to proponents, the use of SRM software can lead to lower production costs and a higher quality, but lower priced end product. SRM products are available from a number of vendors, including 12 Technologies, Manugistics, PeopleSoft, and SAP.

CRM is the acronym of Customer Relationship Management. CRM is a business system that consists of enterprise goals, business strategies, business processes and enterprise information systems. CRM software systems automate many customer-related business tasks.

CRM Definition – A Systems Perspective

Goals of CRM Systems – Goals of CRM is to learn more about customers’ needs and behaviors in order to develop stronger relationships with them and to facilitate acquiring, enhancing and retaining  of customers.