Supplier relationship management for enterprise development in the cement industry

Abstract

Background: Local small, medium and micro enterprises (SMMEs) are ready to join the cement mining companies’ supply chains. However, the perceived risks of doing business with SMMEs cause mines to be hesitant to engage in meaningful relationships with SMME suppliers.

Aim: The aim of this study was to explore the nature of supplier relationship management (SRM) for enterprise and supplier development in a cement mining industry.

Setting: The study is conducted in the cement mining companies and explores insights from SMMEs and cement mines insofar as SRM is concerned.

Methods: The study employed a qualitative research approach, employing interviews as a research strategy and data collection method. In all, 16 individuals were purposively selected based on their expertise and experience in the area SRM for enterprise and supplier development in the cement mining industry. Thematic analysis was used as a data analysis method.

Results: Following thematic data analysis, the following six themes emerged from the primary data: funding the relationship, skills development, segmenting suppliers, supplier compliance, information sharing, and supplier performance monitoring and evaluation.

Conclusion: Enterprise and supplier development (ESD) programmes should be sufficiently formalised and funded. This will enable meaningful skills development for SMMEs with the specific focus on compliance and performance improvement. Enterprise and supplier development programmes should also be designed to facilitate information sharing between the mining company and SMMEs.

Contribution: The study proposes the building blocks for SRM for enterprise and supplier development in the cement mining industry. The study further extends literature in the areas of SRM.