Managing suppliers under the significant service contracts framework
You can have better visibility of your strategic suppliers and highlight risks in supply chains, if you combine reporting on significant service contracts with supplier segmentation.
Currently the government does not have a central view of supply risk. This makes it difficult to know how suppliers are prioritising critical services to government or where there are opportunities for collaboration across the system.
The Auditor General’s report in 2021 provides recommendations to New Zealand Government Procurement (NZGP) and the broader sector. According to the report, important public services will remain vulnerable to unexpected failure unless the public sector makes improvements to the way it manages strategic suppliers.
Over the past year, we have already been working to address many of the issues highlighted in the report, including improvements to supplier relationship management (SRM) and significant service contracts (SSC) reporting. Currently, agencies mandated by the Rules must submit their significant service contracts on a six-monthly basis by 1 March and 1 October.
Segmenting suppliers can help you understand which suppliers are most critical to achieving your business objectives. The segmentation process also helps to highlight risks and opportunities and provides a way to make informed decisions on allocation of resources, time and effort.
Our supplier management toolkit provides best practices and techniques for managing strategic suppliers and can help you with the segmentation process.