Supplier relationship management is no longer just about driving down costs, it’s about enabling innovation, resilience, and long term business value. With deep experience leading procurement across multiple industries and regions, Kenta Shimada offers a nuanced perspective on the evolving procurement landscape in Japan and the broader APAC region. In this Executive Insight, Kenta shares how strategic alignment, digital transformation, and inclusive supplier engagement are shaping the future of procurement, positioning it as a critical enabler of business growth and innovation.
What are the key factors you focus on to build strong relationships with suppliers?
Building strong supplier relationships depends on aligning ethical mindsets and establishing genuine rapport. Through my experience working with both Japanese and foreign owned companies, I’ve seen firsthand the importance of understanding and bridging cultural differences. I proactively share and explain our corporate culture, while also demonstrating acceptance and patience toward suppliers’ emotional responses and working styles. This openness fosters mutual respect and trust, essential ingredients for long term collaboration.
How do you handle conflicts or issues that arise in supplier relationships?
Japan’s consensus driven approach emphasises maintaining relationships while resolving disputes, a dynamic that becomes even more important in light of recent headlines around Japan’s economy and Subcontract Act violations, where job owners can often take a more assertive stance.
In my experience working within a facility management company, disputes with vendors around service level agreements were effectively addressed by implementing a structured Supplier Performance Management System. This clarified expectations and improved compliance. Transparency, open communication, and data driven decision making are essential to mitigating risk and ensuring sustainable procurement. This approach focuses on systemic resolution rather than temporary fixes.
Proactive risk management is also key, identifying and addressing potential issues before they escalate. When conflicts do arise, I rely on a structured framework that includes root cause analysis, collaborative problem solving, and performance based accountability.
How do you measure the performance and success of your supplier partnerships?
A well-run procurement function should be able to quantify the impact of its supplier relationships. Performance measurement must go beyond cost savings to include operational efficiency, service quality, and strategic value contributions, such as time to service or delivery. However, the reality is that procurement teams must first assess where they currently stand and clearly define where they want to be.
In the Corporate (Enterprise) Asset Management industry, I established a centralised P2P SOP portal and spend database to streamline procurement workflows and improve supplier accountability. To measure supplier success, I focus on a combination of operational KPIs (e.g. delivery timelines, SLA adherence), cost efficiency metrics (such as total cost of ownership reductions), and strategic value indicators (including innovation and contributions to process improvement).
In Japan and across APAC, compliance is also a critical factor. Ensuring that suppliers meet local regulatory requirements is essential for maintaining procurement integrity. While global ESG considerations are gaining importance, they remain a medium to long-term goal for many companies in Japan, which are currently more aligned with national standards.
How do you encourage suppliers to contribute to innovation and value creation?
A purely transactional approach to suppliers limits the potential for true value creation. I believe procurement leaders should engage suppliers as innovation partners, not just cost centers. By establishing joint business planning initiatives, suppliers can be encouraged to propose new technologies, efficiency improvements, and alternative solutions that go beyond standard service delivery.
In my experience at a facility management company, I organised and hosted procurement and sourcing events that offered strategic suppliers a platform to showcase their innovative services directly to clients. Additionally, by sharing the corporate forecast with key suppliers, I created opportunities for deeper collaboration, early engagement, and stronger long term partnerships.
How do you approach supplier diversity and inclusion in your SRM strategy?
Supplier diversity and inclusion are becoming increasingly vital in the APAC procurement landscape. One of my key initiatives has been to actively engage SME suppliers and local vendors, especially within Japan’s highly structured market.
In my experience, I’ve used two main methods to support supplier diversity:
A: Leveraging internal networks to introduce new suppliers and align their experience with the company’s operational needs.
B: Re-engaging suppliers after a three year gap in business relationships, which helps maintain a balanced and diversified supplier portfolio.
This approach promotes business continuity, reduces supply chain risk, and contributes to the strengthening of local economies, all while fostering inclusive growth across the supplier base.
