How do you adapt your supplier management strategy to different types of construction projects and markets?

1 Project complexity

One of the main factors that influence your supplier management strategy is the complexity of the project. Complexity refers to the degree of uncertainty, variability, and interdependence of the project activities and requirements. For example, a simple project may involve standard materials and methods, while a complex project may require customized solutions and innovative technologies. The more complex the project, the more you need to select suppliers who have the expertise, experience, and capacity to meet your expectations. You also need to communicate with them frequently, monitor their performance, and manage any changes or risks that may arise.

2 Market competitiveness

Another factor that affects your supplier management strategy is the competitiveness of the market. Competitiveness refers to the level of demand and supply, as well as the number and quality of alternative suppliers. For example, a competitive market may offer lower prices and more options, while a non-competitive market may have limited availability and higher costs. The more competitive the market, the more you need to negotiate with your suppliers, compare their offers, and leverage your buying power. You also need to maintain good relationships with them, secure their commitment, and ensure their loyalty.

5 Supplier integration

A fifth factor that shapes your supplier management strategy is the integration of the suppliers. Integration refers to the degree of coordination and cooperation between you and your suppliers, as well as among your suppliers. For example, a high level of integration may involve joint planning, decision making, and problem solving, while a low level of integration may involve minimal interaction and information sharing. The higher the level of integration, the more you need to share your vision, goals, and plans with your suppliers, and involve them in your processes and activities. You also need to create trust, transparency, and accountability among your suppliers, and foster a culture of teamwork and partnership.

6 Supplier innovation

A sixth factor that determines your supplier management strategy is the innovation of the suppliers. Innovation refers to the ability and willingness of the suppliers to provide new or improved products, services, or processes that add value to your project. For example, an innovative supplier may offer a novel solution, a better quality, or a faster delivery, while a non-innovative supplier may offer a standard or outdated product, service, or process. The more innovative your suppliers, the more you need to recognize their contributions, reward their efforts, and protect their intellectual property. You also need to challenge them, stimulate their creativity, and facilitate their learning.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?