Key Supplier Relationship Management: The Case of Croatian Medium-Sized and Large Manufacturing Companies

The key supplier relationship management represents a vital organizational process. Companies should pay attention not only to managing customer relationships but also to managing relationships with suppliers in order to perform well. They should identify the extent to which a certain supplier adds value through the procurement process. In this line of reasoning, both theory and practice make a distinction between strategic (key) and non-strategic (transactional) suppliers. By employing the segmentation of the supply market, companies balance their supplier portfolio and are capable of identifying the key suppliers. They can also develop specific programs and initiatives that are aimed at preserving these relationships. In the empirical part of the paper, a survey was conducted on a sample of 123 medium-sized and large Croatian manufacturing companies. The structural model involving the relationship between the key supplier relationship management and value-oriented purchasing was tested. The results indicate that there is a statistically direct, positive and significant relationship between these two constructs. Likewise, the results stress that a theoretical conceptualization and operationalization of the key supplier relationship management construct is both valid and justified. Finally, the theoretical and practical implications and limitations of this study are offered.