10 supplier management best practices and strategies
This article is written by our partner, SAP Taulia Supplier management is the term used to describe the processes of selecting and managing suppliers or vendors. It’s a hugely important element of operations for most companies, having a significant impact on costs, manufacturing, and cash flow. Getting the best performance from your suppliers, while also ensuring you’re contributing towards a stable long-term relationship, can pay off in meaningful ways. Knowing how to manage suppliers effectively is therefore of great importance. Supplier management is a multi-step process. Each stage can be optimized to unlock efficiencies that not only improve supply chain performance, but also strengthen overall operational health. These steps can generally be defined as: With poor supplier management processes, your business can face disruption due to late delivery, poor quality goods, inaccurate billing, data breaches, regulatory issues, and commercial and reputational risks. By adopting effective supplier management best practices, you can avoid these pitfalls and enjoy more robust relationships with suppliers. This can lead to greater supplier loyalty, better product quality, and lower costs. The following supplier management best practices and strategies can help you optimize your supplier management processes and get closer to achieving your business goals: 1. Set strategic objectives and establish KPIs Your supplier management objectives should be informed by business needs, with key considerations likely to include cost, supply chain efficiency and resilience. By using supplier key performance indicators (KPIs), you can gain valuable insights into how well your suppliers perform. Common KPIs include: 2. Adopt a centralized supplier management database A centralized and digitized supplier management tool is essential for businesses with complex and extensive supply chains. This can be facilitated by supplier information management (SIM) or supplier relationship management (SRM) solutions. SIM is a system or a set of processes that companies can use to capture, store, and analyze supplier data, thereby reducing the administrative burden and increasing the accuracy of data capture. SRM encompasses the processes a business can use to manage its suppliers and develop more productive relationships. 3. Improve your supplier risk assessment process Your supplier base can pose a range of significant risks to your business, such as the following: As such, it’s vital to assess supplier risk carefully during the supplier selection process and on an ongoing basis. By employing a suitable risk assessment process – and carrying out risk assessments regularly – you can guard against the possibility of future harm. 4. Strengthen your supplier onboarding process During supplier onboarding, it’s important that you obtain various information and documentation to complete all necessary compliance and risk assessments and register the supplier on internal systems. The supplier onboarding process should be as seamless and efficient as possible, as a positive experience can lay the foundations for a strong future relationship. In practice, however, onboarding is often labor-intensive and time-consuming. Onboarding best practices include automating wherever possible, maintaining a consistent approach and ensuring that supplier data is secure against breaches. 5. Segment your suppliers Placing suppliers into different segments or categories according to their importance to the business is one way you can improve your supplier management strategy. By identifying and prioritizing the most important suppliers, you’re able to focus on and strengthen those relationships that are most critical to the resilience of your supply chain. This has significant potential benefits for the overall success of your business in the long run. 6. Integrate automation and self-service By using SIM and SRM software to drive automation, you can achieve a range of efficiencies and cost savings, such as managing contracts in a single location, automating the onboarding process, and monitoring supplier performance in an automated way. Additionally, by offering suppliers self-service options, you may be able to delegate the task of inputting data – thereby reducing overheads and ensuring that supplier records are accurate, complete and up to date. 7. Streamline communication channels Clear and open communication channels are vital to building strong and lasting relationships with suppliers and ensuring supply chain resilience. You can take advantage of various tools to improve your communication with suppliers, including direct messaging and document-sharing tools. Taulia Collaborate, for example, allows suppliers to check on the status of invoices, with queries automatically associated with the relevant purchase order, invoice, or payment document. With conversations tracked in a systematic and centralized way, you can resolve issues with suppliers quickly and easily. 8. Assess supplier performance regularly Your business is directly linked to the performance of its suppliers. As noted above, you can use KPIs to monitor supplier performance against specific criteria and identify any cases where suppliers may be failing to meet agreed standards. If suppliers fall short of their performance targets, an assessment will need to be carried out. If the relationship is strong, it is more likely that poor performance can be tackled successfully. However, if suppliers continue to fall short of their performance targets, you may wish to renegotiate the contract or escalate the issue. 9. Prioritize strong supplier relationships Poor supplier relationship management can lead to poor communication, the breakdown of mutual trust and a mismatch of priorities, which can lead to difficult negotiations, the risk of a communication breakdown, and possible supply issues. Conversely, by prioritizing long-term supplier relationships – for example, by taking advantage of a sophisticated SRM system – you can improve operational efficiency and your supply chain resilience. 10. Formulate supplier management contingency plans Even the best-laid supplier management strategies can fail – so it’s important to anticipate potential disruption by having effective contingency plans. This may include detailing contingency suppliers that could be called upon to protect your business from supplier failure, together with key contacts and possible lead times. With proactive planning, you’ll be better able to protect your business from the consequences of supplier failure. Also Read Join our Treasury Community Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill…
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Treasury at the Speed of Business – Back Office No More: The Rise of the Command Centre
Written by Sharyn Tan (Views are my own) The future of treasury operations is undergoing a profound transformation, shifting from a traditional back-office function focused on static balance sheet management to a dynamic, always-on command center that orchestrates liquidity in real time. This evolution is driven by technological advancements, particularly the rise of stablecoins, tokenized deposits, and broader digital asset integration. These tools are enabling treasurers to manage not just cash positions, but the velocity of money, optionality in funding sources, and risk exposure instantaneously across borders and currencies. Historically, treasury departments operated in batches: end-of-day sweeps, periodic forecasting, and reliance on correspondent banking networks that introduced delays, high costs, and limited visibility. Today, with stablecoins like USDC and USDT surpassing hundreds of billions in market capitalization and annual on-chain transaction volumes in the trillions, treasury is becoming programmable and predictive. Fiat currencies, stablecoins, and tokenized deposits—digital representations of traditional bank deposits issued on blockchains—are coexisting in a seamless ecosystem. This allows for composable liquidity, where funds can be moved, converted, or deployed programmatically without intermediaries or settlement windows. Instant Visibility and Predictive Forecasting One of the most immediate benefits is real-time visibility. Traditional systems often provide delayed snapshots, but blockchain-based infrastructure delivers continuous, transparent ledgers. Treasurers can monitor global cash positions down to the second, track inflows and outflows automatically, and trigger actions like sweeps or FX conversions when balances hit predefined thresholds. This reduces idle capital buffers—2.5–4% in traditional setups can equate to tens of millions —and improves capital efficiency. Forecasting evolves from reactive to predictive. AI-driven tools analyze historical patterns, market data, and real-time flows to anticipate liquidity needs. For instance, systems can automatically rebalance across entities, optimize for yield on excess balances, or position funds closer to operational hotspots. In cross-border scenarios, stablecoins enable near-instant settlement (often in seconds or minutes), slashing costs and FX exposure compared to multi-day traditional wires. Liquidity as a Composable Network The core shift is viewing liquidity as a dynamic network rather than isolated pools. Stablecoins act as an interoperability layer, connecting disparate systems and enabling 24/7 operations. Tokenized deposits, issued by regulated banks, offer similar programmability while staying within the banking framework—often with deposit insurance and direct balance sheet integration. Reports indicate banks are increasingly favoring tokenized deposits for institutional use, as they plug into existing treasury workflows without disrupting regulatory treatment. This coexistence creates optionality: treasurers can choose the optimal form of money for each use case—stablecoins for fast cross-border payments, tokenized deposits for wholesale settlement, or traditional fiat for certain compliance needs. Programmable features, like smart contracts, automate complex workflows: conditional payments upon milestone achievement, automated collateral transfers, or yield-earning while funds are in motion. Challenges on the Path Forward Achieving this future isn’t just about adopting technology—it’s about building trust, interoperability, and cultural change. Treasurers must develop fluency in digital assets, including understanding blockchain mechanics, wallet management, and on-chain risks. Governance frameworks for programmable money are essential to mitigate smart contract vulnerabilities or de-pegging events, even as regulations like the U.S. GENIUS Act (passed in 2025) provide clearer guardrails for stablecoins, requiring 1:1 reserves and transparency. Interoperability remains a hurdle: not all blockchains or systems communicate seamlessly, necessitating standards and partnerships. Cultural shifts are equally critical—treasury teams historically risk-averse must embrace experimentation while maintaining robust controls. New ecosystem partnerships—with fintechs, blockchain platforms, and traditional banks—are vital for scaling. The Treasurer’s Strategic Imperative Ultimately, the future of treasury isn’t about going digital for novelty—it’s about accelerating decision velocity. Technology becomes a liquidity enabler, turning treasury from a pure cost center into a strategic partner to help drive business value. Treasurers who thrive will treat digital tools as extensions of their toolkit: optimizing velocity to free working capital, reducing borrowing costs, and earning yield on otherwise idle funds. Those who view these innovations as risk multipliers will lag, while forward-looking leaders will build predictive, composable operations that respond instantly to opportunities and threats. In a world of always-on global finance, the treasury command center isn’t a distant vision—it’s emerging now, redefining how organizations will manage money at the speed of business. Also Read Join our Treasury Community Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below to get more information. Notice: JavaScript is required for this content.