03 Dec Three Simple Steps Which Could Improve Your Supplier Performance
I’ve never liked the term ‘B2B’.
I feel it almost suggests that the way you interact with other businesses (in our case, Suppliers) should be different. But whether B2B or B2C, it is still about the interaction between people and communities.
Successful Supplier Engagement is not about motivating ‘a supplier’; it means motivating the people within your Suppliers: the quality manager, the technologist, even the delivery driver who fills in occasionally to manage the delivery schedule. They all are key when it comes to ensuring fast and high quality interactions with Suppliers.
This brings me to our second intrinsic motivator, Progression, which I believe is one of the best ways to motivate the individuals within your Suppliers.
Progression can be summarised as the cycle of goal, growth and gratification. It’s the gratification, that personal sense of achievement, which I believe you can ‘bottle’ and use to motivate your Suppliers to perform, time and time again. Here’s how…
Step 1: Goal
With this approach a goal should go beyond a recorded objective (for example: achieve complete specifications to a ‘gold standard’). It must extend to clear ownership and the path someone needs to follow to achieve the objective.
We’ve found most success when we bring these paths to life with an online ‘Path’. This is a sequence of bite sized e-Learning materials (we call this ‘Supplier Self-Help’) and tasks required to reach the goal.
Building on our ‘’gold standard’ specification example – once the objective is explained, the individual responsible for this measure at the Supplier’s organisation would have the ‘Gold Spec’ Path attached to their profile. This path would cover key topics such as how to enter information into the specification system. The Path can only be completed by finishing all the tasks.
This method empowers the individual to achieve the objective on behalf of your Supplier faster and with less day-to-day support; allowing you and your Suppliers to focus on creating value within meetings rather than fighting the proverbial fires. Isn’t it better sitting down to talk with your Suppliers about new product ideas rather than updating the specifications of existing ones.
Step 2: Growth
As the person progresses along the path towards the goal it’s important to show their personal growth. This keeps them going by giving them small hits of gratification as they see what they have achieved so far and how close the finish line is. This also provides visibility and accountability to others within the Supplier organisation to recognise the progress they are making or if needed, apply pressure when they are behind
By using Visual Management Dashboards you can quickly share up-to-date performance information without any day-to-day administration associated with using spreadsheets. I’d recommend going further and sharing individual and Supplier performance against the top and bottom 10% of Suppliers. This gives context and allows people to benchmark their performance both at an individual and organisational level.
Integrate knowledge into your dashboards to address those areas where Suppliers are not progressing as quickly as planned or underperforming against their peers. This can be as little as a link to an explanation of how to improve the score.
Step 3: Gratification
Success! Your Supplier has achieved their goal. But the process is not over, in fact this is arguably the most important part. To keep the cycle of motivation going you need to reward not only the Supplier, but the individual who achieved the goal on behalf of the Supplier.
As covered in last week’s blog (How Telling Stories Can Significantly Boost Supplier Performance) the beauty of intrinsic motivation is that it’s free.
Gratification is not only free but also one of the most satisfying rewards someone could receive.
Simple things like showing a Visual Management Dashboard at 100% provides gratification. However, you can go still further by:
- Hosting an annual Supplier Conference and recognising high performing individuals and Suppliers
- Publishing an online Supplier leader board for your chosen performance metrics
- Allow individuals and organisations to gain physical certificates or virtual ‘badges’ for each Path and actively promote partnerships with those Suppliers who commit more to development
- Share Supplier success internally and personally email the people to say Well Done and Thank You
All of the above give the people who work for your Suppliers the sense of gratification both as individuals and as a collective organisation which keeps them on upwards cycle of Supplier Performance: Goal, Growth, and Gratification. They build trust in you and your brand, they build stronger relationships and they help you to use your Supply Base as your most valuable asset.