Effect of Supplier Relationship Management on Organizational Performance: A Case Study of the Plastic Manufacturing Industry in Harare Between 2015-2019

Abstract

Supplier relationship management (SRM) is the overall coordination, collaboration and information sharing between an organization and its suppliers. The study focused on the effect of supplier relationship management on organizational performance for firms in the plastic manufacturing industry in Harare. This research adopted an interpretivism philosophy and data was collected using open-ended questionnaires and telephonic interviews. The population was derived from plastic manufacturing companies operating in Harare. A purposive sampling technique was used to select twenty participants. The study findings revealed that organizations in the plastic industry enjoyed several supplier relationship management benefits that included information sharing and involvement of suppliers in new product development as these contributed positively to their overall organizational performance. However, firms in the plastic manufacturing industry also encountered supplier relationship management challenges that affected their organization’s performance. Challenges such as organizations failing to meet their obligations to the buyer–supplier relationship resulting in negative reactions by suppliers. Supplier relationship management implementation was also constrained by challenges that included the unavailability of supplier relationship management (SRM) team and lack of resources to support the SRM system. It was however noted that organizations in the plastic of supplier relationship management to the organizational performance. These strategies included open communication with suppliers for the purposes of sharing critical information, the involvement of suppliers in the new product manufacturing industry implemented SRM strategies that ensured the positive contribution development and supplier certification as a pre-requisite to supplier engagement. The study, therefore, recommends that organizations in the plastic manufacturing industry continue to develop and maintain clear lines of communication with their suppliers. These would enable suppliers to share information that is critical in their strategic decision-making process. Further recommendations were also made to the effect that organizations in the plastic manufacturing industry should always endeavor to honor their obligation to the buyer-supplier relationship.

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