Background and Perspective Making the Business Case for Supplier Relationship Management 1 Annual Meeting April , 2013 Orlando, Florida

The Importance of Being Strategic Annual Meeting April , 2013 Orlando, Florida 2 Personal Skills Strategic

Defining Supplier Relationship Management Annual Meeting April , 2013 Orlando, Florida 3 The practice and process for interacting with suppliers The discipline of strategically planning for, and managing, all interactions with third party organizations that supply goods and/or services to an organization in order to maximize the value of those interactions The discipline of driving strategic supplier performance to achieve goals established to promote value creation beyond price and to maintain / improve the overall quality of delivered goods / services

Spend Management Annual Meeting April , 2013 Orlando, Florida 4 Strategic Sourcing Supplier Relationship Management Supplier Plan Category Plan Spend Analytics University Spend MRO Supplies Grainger Contract Execution Manage Relationship

Lessons from Outside Higher Education Annual Meeting April , 2013 Orlando, Florida 5 Jointly Developed ScorecardExecutive Sponsorship Relationship Manager Executive Assigned to Each Relationship Escalation Procedures Well Defined Cross-functional ownership across departments Activity Based on Criteria Engage Supply Partners Beyond Price StrategicTactical Goals Who is Accountable? Issue Resolution Value Creation

Why Focus on Supplier Relationship Management? Annual Meeting April , 2013 Orlando, Florida 6 UP DOWN RevenueValue Risk Cost Signing Bonus Rebates Other Incentives Price Efficiency Standardization Service Level Quality Innovation Supply Availability Adverse Events

7 Core Elements of SRM Annual Meeting April , 2013 Orlando, Florida 7 Supplier Relationship Management Supply Base Segmentation Executive Sponsorship Supplier Relationship Governance Supplier Engagement Process MetricsPeople SkillsTechnology

SRM at the University of Colorado Making the Business Case for Supplier Relationship Management 8 Annual Meeting April , 2013 Orlando, Florida

The Procurement Service Center Annual Meeting April , 2013 Orlando, Florida 9

Program History Annual Meeting April , 2013 Orlando, Florida 10 Began in 2009 to drive price compliance and support procurement objectives Managed suppliers in two categories (Tier A & Tier B) The PSC drives SRM goals and activities Business review process well-established Increasing executive awareness Dedicated Resources Started with 1 FTE Now have 2 FTE’s

Program Objectives Annual Meeting April , 2013 Orlando, Florida 11 Value Delivery  Increase value creation  Sustain value achieved through strategic sourcing Process Management  Increase electronic processes  Reduce systemic issues  Drive supplier accountability Support Stakeholders  Increase spend under management  Improve stakeholder service levels  Communicate value delivered to organization

How the Program Works Annual Meeting April , 2013 Orlando, Florida 12 Price / Rebates Contract Compliance Standardization / Consolidation Utilization / Demand Management Process / Technology Communication Strategies Supplier Targets Departmental Ownership Integration Complexity Sourced Value Ownership Assignment Segmentation Strategy Procurement Managed Procurement Supported Department Owned Implementation Activity Focus Leads Implementation Activities, Owns Relationship, Manages Account / Business Reviews

Program Coverage Annual Meeting April , 2013 Orlando, Florida 13 5%

Potential Targets for Expansion Annual Meeting April , 2013 Orlando, Florida 14

Program Success Annual Meeting April , 2013 Orlando, Florida 15 Great Contracts Top CustomerService Improved Process EfficiencySpend Consolidation Executive Attention

Executive Sponsorship Annual Meeting April , 2013 Orlando, Florida 16 SUPPLIER BREAKFAST WITH PRESIDENT BENSON AS THE GUEST SPEAKER

What is Next? Annual Meeting April , 2013 Orlando, Florida 17 Price / Rebate Negotiation Price / Rebate Compliance Consumption Management Process Management Joint Strategic Alignment Developmental Timeframe Value Supplier Segmentation ROI Discussion - Is the effort worth the return, or should we shift focus to other vendors where these impact categories can drive top results? Impact Categories Current Focus - Supplier relationships owned and managed by procurement Potential Focus - Supplier relationships owned outside of procurement 1 IMPROVE STRATEGIC FOCUS OF CURRENT PROGRAM 2 MORE INFLUENCE ON UNIVERSITY STRATEGIC SUPPLIERS

Improvement Opportunities Making the Business Case for Supplier Relationship Management 18 Annual Meeting April , 2013 Orlando, Florida

Supply Base Segmentation Annual Meeting April , 2013 Orlando, Florida 19 TBD Opportunity: Develop Criteria for Strategic Suppliers

Executive Sponsorship Annual Meeting April , 2013 Orlando, Florida 20 Opportunity: Develop an Executive Steering Committee

Supplier Relationship Governance Annual Meeting April , 2013 Orlando, Florida 21 CASCADE IMPACT ON GOAL SETTING Organizational Objectives Category Strategies Departmental Objectives Procurement Objectives Sub-Strategies  Sourcing  Supplier (SRM)  Process Improvement  Consumption Mgmt  Compliance / Technology Influence Support Legend Opportunity: Increase cross-functional leadership

Supplier Engagement Process Annual Meeting April , 2013 Orlando, Florida 22 Opportunity: Focus activity on strategic value

Value Analysis & Metrics Annual Meeting April , 2013 Orlando, Florida 23 Opportunity: Develop a two-way performance scorecard

People Skills Annual Meeting April , 2013 Orlando, Florida 24 1 Emphasize the Importance of Relationship Skills 2 Add Data Analysis Skills 3 Develop a Repeatable Methodology 4 Develop a Training Curriculum Opportunity: Build cross-functional skills

Technology Annual Meeting April , 2013 Orlando, Florida 25 Opportunity: Integrate spend analysis software

5 Things To Do Now Annual Meeting April , 2013 Orlando, Florida 26 1 REFLECT ON THE DIFFERENCES BETWEEN THE 5 MOST IMPORTANT PROCUREMENT RELATIONSHIPS V. THE 5 MOST IMPORTANT STRATEGIC UNIVERSITY RELATIONSHIPS 2 ESTABLISH GOALS FOR THE 5 MOST IMPORTANT PROCUREMENT RELATIONSHIPS 3 ASK YOUR KEY SUPPLIERS HOW YOU CAN BECOME A BETTER CUSTOMER? 4 BUILD CAPACITY FOR SRM ACTIVITY BY STUDYING YOUR WORKLOAD AND STREAMLINING TACTICAL ACTIVITY 5 LEARN MORE ABOUT SRM – SIGN UP FOR THE STRATEGIC PROCUREMENT INSTITUTE

Questions Annual Meeting April , 2013 Orlando, Florida 27