|PULSE: Transparency = Trust in Relationships
Transparency = Trust in Relationships
Transparency is a topic that is resonating loud and clear with buyers, suppliers and advisors who want openness and honesty in all aspects of their relationships and understand its critical importance post-pandemic.
A brainstorming session at IAOP’s Collaborative Supplier Governance event showed all parties want clarity around such issues as mandatory return to work, driving more value, supplier profitability, innovation, change management, insights and analytics, due diligence, stakeholder alignment and relationship building.
The interactive working session at Avasant’s offices near Washington D.C. generated a long list of drivers that each group wants as they interact on supplier management initiatives. Participants emphasized the need for transparency in every facet of the relationship, including pricing, performance metrics, and service levels.
“Transparency helps ensure that both parties are aligned and working towards the same goals, and it can also help identify areas where improvements can be made,” said Mark Voytek, a TCS executive advisor and managing partner of Voytechnology Partners who facilitated the session.
The importance of communication in establishing transparency was a key theme that emerged from the discussion. Participants emphasized the need for open and honest communication and for clear and concise reporting of key metrics. This helps build trust and ensures that both parties are aware of any issues or challenges that arise.
Both suppliers and clients face significant challenges when it comes to supplier management. Poor management can lead to a lack of transparency in pricing and performance, causing the relationship to suffer. Additionally, clients may not have the expertise or resources to effectively manage their suppliers, leading to a breakdown in communication and trust.
Another key theme was the need for a clear and defined governance structure to support transparency. Participants emphasized the importance of having a clear set of rules and procedures to guide the relationship and resolve any disputes that may arise. Third-party advisors were also mentioned as potential mediators who could provide unbiased advice and guidance to both parties.
While transparency is essential in supplier and client relationships, achieving it can be challenging. Advisors can play a role in helping both suppliers and clients navigate these challenges and establish a culture of transparency. They can provide valuable insights into client expectations and supplier performance and offer guidance on how to improve transparency and communication in the relationship.
By working with a third-party advisor, both suppliers and clients can benefit from unbiased advice and guidance that can help improve transparency and build a stronger relationship. This can ultimately lead to improved performance, better outcomes, and a more successful partnership for both parties.
“Transparency plays a critical role in building a strong supplier and client relationship,” Voytek said. “By establishing clear communication channels, developing a strong governance structure, and being transparent in all aspects of the relationship, suppliers and clients can build a partnership that is built on trust, collaboration, and shared success. By working together, both parties can create a strong and sustainable business relationship that benefits everyone involved.”
Voytek and Liz Evans, Principal, Transformation GBS at PwC, led a session at OWS23 on Collaborative Supplier Governance and The Importance of Transparency that explored the role of transparency in effective supplier governance and highlighted best practices for collaboration between suppliers and buyers.
A follow-up design thinking workshop after the Summit will take the input from the session in May to help drive further a plan to create change in the market as it relates to transparency in supplier relationships. Design thinking is a problem-solving approach that involves empathizing with users, defining their needs, and developing solutions that meet those needs. In the context of outsourcing, design thinking can be a powerful tool for identifying opportunities to improve the relationship between the supplier and the buyer, as well as developing new approaches to managing the outsourcing process.
The OWS session discussion on transparency in vendor management, post-contract signature, and supplier management, in preparation for the design thinking session, will provide attendees with practical tips and strategies for managing outsourcing relationships successfully.
Be on the lookout for the IAOP Design Thinking Session on Relationship Transparency in the future.