Ariba Knowledge Nuggets -Supplier Performance Management - Part II - Performance Management Process and Best Practices

Version 1

    The forces of globalization are fundamentally changing the way that companies operate and compete, offering both business opportunities and challenges. The quest for lower-cost sources of supply and the promise of new markets are driving organizations of all sizes—from large, Fortune 50 enterprises to small Midwest manufacturers—to venture into the global economy. At the same time, increased competition from emerging markets, a sagging U.S. dollar and tightening supply markets are quickly erasing the lines between local and global supply chains.

     

    Even as companies seek to sell, compete and secure supply in far-reaching corners of the world, they also must contend with challenges inherent to the global supply chain. Longer lead times mean that supply chain executives are recalculating the balancing point between “too Lean” and “too much inventory.” Supply uncertainty is forcing a greater emphasis on supply chain risk management as a discipline. And the need to negotiate and govern business contracts across multiple jurisdictions is adding new complexity to the supply management process and prompting procurement

    executives to reexamine the skills necessary for managing a global supply base.