The 8 Modules, 31 Focus Points and 5 Collaboration Phases of the SEIC Methodology provide a path to success

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Our Diagnostic Tool provides a gap analysis of SEI capability to support the strategic planning process

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In-depth explorations of the approaches and techniques used by leading organizations in the field of SEI today

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Thought leadership and insightful articles on the most important issues for companies pursuing an SEI agenda

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Insight calls are available to join for all members of the SEIC and will be addressing a number of topics

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Useful downloads, from unique research to practical templates, frameworks and tools being used by SEI leaders

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The 11 modules of the SEI methodology focus on the key processes that enable the successful rollout of SEI

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Our Capabilities Assessment tools provide the means for organizations to gain insight into their own SEI approach

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In-depth explorations of the approaches and techniques used by leading organizations in the field of SEI today

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Thought leadership and insightful articles on the most important issues for companies pursuing an SEI agenda

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Useful downloads, from unique research to practical templates, frameworks and tools being used by SEI leaders

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Takeaways from the SEIC workshop on stakeholder engagement

Different companies pursue SEI for different reasons – but shared challenges and solutions exist regardless of industry focus. This became apparent during our recent workshop on stakeholder engagement

Stakeholder workshop

 

Engaging the right stakeholders is a do-or-die pursuit in Supplier-Enabled Innovation. Without buy-in and commitment from across the business, SEI will quickly become an isolated and irrelevant initiative within procurement.

 

These sentiments were shared across the 14 companies gathered at Bayer’s headquarters in Leverkusen during an SEIC workshop on engaging the business for supplier innovation. While a cross-industry group of businesses, each company recognized that common challenges – and, crucially, solutions to those challenges – exist within their stakeholder-engagement strategies. This allowed each company to learn and develop from the experience of others.

 

Here, we run through the key lessons from that workshop.

 

Challenge: The perception of procurement

 

The reputation of procurement was cited as an area of concern by several companies. Procurement is typically seen as a back office, cost-saving function in most businesses, with little capacity to add value or contribute to innovation. This prevents many procurement-led SEI programs from getting a seat at the table when it comes to innovation strategy, cutting SEI off from the key functions it needs to engage with, such as R&D, engineering, and finance.

 

Solutions

  • Procurement should identify relevant best-practice examples from peers, and use these to convince stakeholders of SEI’s impact and ease of implementation;
  • Identify stakeholders who are more willing to experiment and have a passion for innovation. With these stakeholders, begin to create pilot projects;
  • With the creation of pilot projects, start to build success stories to show the wider business;
  • Scout and, if possible, segment the existing supply base to show capability exists that matches the strategic aims of the company;
  • Install non-traditional procurement metrics (for example, speed to market and idea-to-projects conversion) to showcase how procurement-led SEI is directly impacting the business.

Challenge: Persistence of a ‘not-invented-here’ attitude in the business

 

The scenario is a common one in many multinational companies. Several strategic functions retain a ‘not-invented-here’ attitude towards innovation, wherein IP must be produced internally and not sourced externally. SEI then becomes an irrelevant pursuit in the eyes of these stakeholders.

 

Several of the solutions for the ‘perception of procurement’ challenge are also relevant here – but there is one specific solution to this problem that is being used across different industries.

 

Solutions

  • Align supplier-innovation meetings – where key suppliers come into the business to discuss challenges – with the wider company’s innovation days;
  • This results in external insights being shared in some of the discussions taking place, which both promotes how a ‘not-invented-here’ attitude is no longer compatible with the business’s interests, and raises awareness of how suppliers possess capability that the business needs.

Challenge: The business is not set up to advance SEI

 

Many members believe the structure of their company isn’t conducive to SEI. A number of contributing issues were identified for this, including a lack of resources in procurement to advance SEI and therefore sell it to stakeholders; a lack of understanding – both in procurement and in other functions – of what the business’s needs are; and organizational complexity and outdated processes. There is also concern around the short-term focus on profit and loss within many companies, which can undermine the efforts of an SEI program.

 

Solutions

  • Clearly define the scope of activities and resources required for SEI;
  • Once identified, help create required resources by automating or outsourcing transactional procurement tasks;
  • By leveraging the ‘success stories’ highlighted in the ‘perception of procurement’ challenge, align with company leadership and gain an understanding of their strategic priorities;
  • With this understanding, develop an ambitious SEI vision as well as targets for the entire company;
  • Identify and help promote SEI advocates in key functions across the business;
  • Encourage top-down communication on the importance of external innovation. This will in turn help change company culture and attitudes towards external innovation.

Challenge: SEI doesn’t provide enough cost savings

 

The final challenge is one closely related to an earlier point: that the business retains too great a focus on profit and loss. There is a perception in business that Supplier-Enabled Innovation will detract from procurement’s conventional role – to drive down costs and therefore improve the profit margin of a company – which can haemorrhage stakeholder support for SEI. The solution here is to prove this isn’t the case.

 

Solutions

  • Focus on supplier innovations that can help reduce cost in the business;
  • Brose provides an example: by working collaboratively with its supply base, it developed innovative methods for reducing the weight of its products, resulting in the elimination of 30,000 tons of weight over a three-year period and a drastic reduction in cost;
  • Build up stories such as these to show how SEI will not detract from procurement’s ability to reduce cost, and may in fact improve it.

Further reading

In addition to the solutions that came out of our workshop, members can access a number of resources on stakeholder engagement through our dedicated section on it. In particular, our Guides on SEI first steps and Supplier Innovation Days provide further insights to some of the challenges discussed in the workshop.

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