bottom line by implementing supplier relationship management best practices, and a 2011 Aberdeen Group report found that Best-in-Class companies were 38% more likely than others to use tools for supplier risk analysis and mitigation. Actions recommended by the Aberdeen Group research included standardising supplier management practices and improving the quality of supplier data. Systematic collaboration In practice, SRM expands the scope of interaction with key suppliers beyond traditional buy-sell transactions to encompass other joint activities which are predicated on a shift. More disciplined and systematic, and often expanded, information sharing Joint demand forecasting and process re-engineering (has unlocked savings of 10–30 percent for leading organizations). Technology and systems There are myriad technological solutions which are purported to enable SRM. These systems can be used to gather and track supplier performance data across sites, business units, and/or regions. The benefit is a more comprehensive and objective picture of supplier performance, which can be used to make better sourcing decisions, as well as identify and address systemic supplier performance problems. It is important to note that SRM software, while valuable, cannot be implemented in the absence of the other business structure and process changes that are recommended as part of implementing SRM as a strategy. The main benefits are: Make Fact-Based decisions Reduced costs (long-term) Improvements based on specific objectives Instant feedback to identify areas of improvement Get a 360° picture of each supplier Long-Lasting relationship Improved coordination, consistency, and transparency Enhanced fairness and motivation Accessible measurements and increased visibility The main drawbacks: Takes time and focus for implementation Requires changes in behavior and culture Requires investment Fundamental business structure Challenges Creating the business cases Executive sponsorship Calculating ROI (return on investment) Developing an SRM sales pitch Finding vendors who have SRM capabilities SRM and supplier performance management Some confusion may exist over the difference between supplier performance management (SPM) and SRM. SPM is a subset of SRM. A simple way of expressing the difference between SPM and SRM is that the former is about ensuring the supplier delivers what has been promised in the contract, which suggests a narrow, one-way process. SRM, in contrast, is about collaboratively driving value for both parties, resulting in lower costs, reduced risk, greater efficiency, better quality, and access to innovation. This requires a focus on both negotiating the contract and managing the resulting relationship throughout implementation, as well as systematic joint value-discovery efforts. Implementation Writer