Two years ago, Avendra revamped its approach to strategic supplier management and developed an innovative and unique approach for proactive supplier management, complete with new tools and processes designed to deliver more value to our suppliers and customers than any other company in our industry is able to do. The approach included the formation of the Business Ownership (BO) team — a group of subject matter experts in a wide range of categories complemented by strong analytical expertise.
Avendra’s BO team focuses on maximizing the success of Avendra’s contracts – both to our customers and to our suppliers. The team systematically evaluates supplier performance; identifies and pursues strategic opportunities between suppliers, customers and Avendra; and ensures we are continually evaluating and challenging current practices to provide the best value through our programs.
Specifically, the BO team focuses on the following three areas:
- Operational excellence; and
- Collaboration between customers and suppliers.
- Ultimately, growth. If our suppliers are doing a great job, customers will use them more and more, and their business will grow.
Today, through state-of-the-art technology, tools and processes, the BO team provides day-to-day management, as well as strategic oversight of more than $2.5 billion in spend—all in pursuit of continuous improvement through the supply chain.
“Our mission is to optimize Avendra’s suppliers’ performance and ensure our customers enjoy the full benefits of our supplier relationships and all the products and services that they offer. Our suppliers’ best-in-class customer value proposition translates into increased market share for our suppliers, which delivers value to our supplier partners,” explains Asaf Kahn, Avendra’s Senior Director of Business Ownership. “The Business Ownership team works to uncover new opportunities that ensure both customers and suppliers receive the maximum benefit from their relationship with Avendra.”
Here are just a few of the unique ways Avendra’s BO team provides a top-tier supplier management process that delivers more value to our customers than ever before:
Key Performance Indicators (KPI) Scorecards
KPI Scorecards utilize strict, proprietary performance metrics to help monitor supplier operations, evaluate trends and assess overall performance. These quarterly reports provide visibility to key contractual provisions and help hold suppliers accountable to a high-level of performance in areas critical to customers (fill rates, compliance, QA, etc.). Avendra associates review scorecards with suppliers on a quarterly basis to help them focus on opportunities for improvement. This tool not only benefits customers by ensuring suppliers adhere to contractual requirements, it also allows suppliers to improve their overall operations and become better at what they do. Click here to view a sample supplier scorecard.
Incremental Spend Model
Avendra views data as an incredible asset, particularly when we can put that data to use to better serve our customers. The Incremental Spend Model is a unique, proprietary financial model that identifies the best opportunities for collaboration between customers and suppliers. The tool focuses on key programs customers have signed up for, but are not being utilized to their full potential. Generating growth in these areas allows customers to benefit from Avendra contracts by saving money and enjoying best-in-class service levels.
Field Support & Customer Relations (FSCR) Survey Results
Without a doubt, the most important supplier data Avendra receives is from its customers. The FSCR Survey ranks suppliers using customer feedback and comments, based on first-hand interaction with customers. Suppliers are rated between 1 and 5 for Pricing, Quality and Customer Service. The BO team then shares the results with the supplier, identifies areas of opportunity, and allows suppliers to follow-up, correct issues and raise their performance where needed.
Sales Lead Generator Tool
When an Avendra Field Support representative visits a property, they tend to receive requests from the customer about a specific product, service or supplier they are interested in using. A new tool to capture and track these customer requests was created through a joint effort by the FSCR, Avendra Technology and Business Ownership teams. Each “lead” entered into a main database is shared with the relevant suppliers through a web-based tool. The supplier then follows-up with customers directly to understand their needs better and to then begin to provide the products or services they requested. The BO team “quarterbacks” the process to ensure leads are processed and addressed.
The tools described above, alongside an innovative, comprehensive, state-of-the-art supplier dashboard, are designed to not only ensure suppliers adhere to contractual provisions, but also exceed them and continuously challenge themselves to improve their performance.
“Avendra’s Contracting team applies expertise, experience and best practices to develop best-in-class contracts,” says Asaf Kahn, ”Business Ownership then provides ongoing oversight, ensures suppliers are held accountable to contractual provisions and identifies opportunities to continuously improve and create even more value for our customers, through growth, operational excellence and collaboration.”