Unleashing the Power of Supplier Innovation

In today’s dynamic landscape, innovation isn’t just a buzzword; it’s a necessity. Schneider Electric, a France-based energy management and digital automation company, has garnered attention for deploying over 500 supplier innovations in just five years. These innovations have not only streamlined operations but also resulted in an incremental revenue of €80 million to €100 million annually. How did they achieve this remarkable feat? The answer lies in their structured approach to supplier-driven innovation. In this Weekly Spotlight, we delve into the methods employed by Schneider Electric and discuss how these practices could benefit wealth and asset managers.

Schneider Electric’s innovation system is divided into two levels:

Procurement Innovation Evaluation Board: This centralised board screens all incoming ideas based on company-wide criteria.

Innovation Squads: Decentralised groups organised by business unit and region. They implement ideas that have already been vetted by the Evaluation Board.

This dual-level structure allows Schneider Electric to balance general company needs with specific requirements of various business units.

The two-pronged approach ensures that innovation is both strategic and targeted—qualities that are essential for wealth and asset managers. A similar system could be used to vet new financial instruments or risk management solutions, ensuring they align with the broader strategy whilst meeting the specific needs of diverse portfolios.

Schneider Electric uses a simple 3×3 matrix that grades ideas based on their alignment with company strategy and their financial attractiveness. This initial “filter” quickly separates high-potential ideas from the less promising ones, allowing the company to focus its resources where they are most likely to generate returns.

Similarly, asset managers can use scoring matrices to evaluate potential investments or innovative fintech solutions. By grading opportunities on factors like potential return and alignment with client goals, firms can make faster, data-driven decisions.

Once an idea passes the initial screening, it is then evaluated against seven objective criteria. This step eliminates subjectivity and ensures that only the most promising innovations are implemented.

A similar multi-criteria approach could be highly beneficial for wealth and asset managers when considering new portfolio diversification strategies, software solutions, or customer engagement tools. By setting strict guidelines, managers can ensure they are only investing in innovations that will provide real value.

Much like Schneider Electric, VENDOR iQ believes in the transformative power of innovation—especially when it’s nurtured within a robust, systematic framework. For wealth and asset managers who aim to drive their strategies through a structured approach, VENDOR iQ provides solutions that resonate with the principles we’ve explored here.

VENDOR iQ employs a rigorous methodology for vendor evaluation, just as Schneider Electric does for its suppliers. Through our platforms, we offer a suite of solutions that enable wealth and asset managers to assess, score, and implement different strategies and fintech solutions based on hundreds of data points. This targeted, data-driven approach empowers managers to focus their resources efficiently and realise untapped value in their operations.

As Schneider Electric demonstrates, a structured approach to innovation can yield significant dividends. By applying similar principles, wealth and asset managers can navigate the complexities of the financial world with greater agility and foresight.

The methodologies and tools provided by VENDOR iQ make translating these innovations into practice even more achievable. Therefore, whether it’s in energy management or wealth and asset management, a systematic approach to innovation provides a pathway to success.

The time to innovate is now. As we’ve seen from Schneider Electric’s success, a structured approach to supplier innovation can bring transformative changes and significant financial gains. Wealth and asset managers can benefit from a similar methodology, harnessing the power of a structured evaluation system for decision-making and innovation.

VENDOR iQ stands ready to support you in this journey. With our comprehensive suite of solutions and evaluation methods based on hundreds of data points, we are committed to helping you make more informed, strategic decisions. Don’t miss out on the opportunity to drive your operations to the next level.

To learn more about how VENDOR iQ can empower your wealth and asset management strategies, contact us today.