Why is supplier development an important aspect of Supplier Risk Management?

Supplier development is an important aspect of Supplier Risk Management because it focuses on enhancing the capabilities of suppliers, which leads to improved outcomes for both the supplier and the buying organization. Through processes such as training, process improvement, and investment in technology, supplier development helps suppliers increase their efficiency, quality, and reliability. By strengthening the supplier's capabilities, organizations can reduce risks related to supply chain disruptions, product quality issues, and other operational challenges.

When suppliers become more capable, they can better meet the demands of the buying organization, ultimately leading to a more resilient supply chain. This collaborative approach fosters a stronger partnership between the buyer and the supplier, which is essential for long-term success and innovation in the supply chain. Thus, the enhancement of supplier capabilities through development efforts is a cornerstone of effective Supplier Risk Management.