Download - Week5 Supplier Relations
WEEK 5
SUPPLIER RELATIONS
KEY QUESTIONS IN STRATEGIC SUPPLY MANAGEMENT
HOW CAN WE…..
• IMPROVE OUR RELATIONS WITH SUPPLIER ?• INVOLVE OTHER FUNCTIONS MORE EFFECTIVELY ?• INITIATE A PARTNERSHIPS OF ALLIANCES WITH OUR
KEY SUPPLIERS?
KEY STRATEGIC DECISIONS IN SUPPLY MANAGEMENT
1. WHICH SUPPLIER TO PURSUE
2. WHAT KIND OF RELATIONS TO MAINTAIN WITH SUPPLIERS
STRATEGIC DECISIONS IN SUPPLY MANAGEMENT
STRATEGIC SUPPLY MANAGEMENT IS FOUNDED ON THE CONVICTION THAT A SIGNIFICANT COMPETITIVE EDGE
CAN BE GAINED FROM THE SUPPLIERS AN ORGANIZATION HAS DEVELOPED AND ITS SUPPLY SYSTEMS AND SUPPLIER
RELATIONS.
STRATEGIC DECISIONS IN SUPPLY MANAGEMENT
SUPPLIER PERFORMANCE HAS A GREATER IMPACT ON THE PRODUCTIVITY, QUALITY AND COMPETITIVENESS OF THE
ORGANIZATION.
STRATEGIC DECISIONS IN SUPPLY MANAGEMENT
RECENT TRENDS TO BUY INSTEAD OF MAKE, TO OUTSOURCE INSTEAD OF CONTINUING TO MAKE, TO
IMPRO VE QUALITY, TO LOWER INVENTORIES, TO INTERGRATE SUPPLIER AND PURCHASE SYSTEMS, AND TO
CREATE COORPERATIVE RELATIONS SUCH AS PARTNERSHIPS HAVE UNDERLINED THE NEED FOR
OUTSTANDING SUPPLIER PERFORMANCE.
STRATEGIC DECISIONS IN SUPPLY MANAGEMENT
SIMPLIFIED SUPPLY CHAIN PERSPECTIVE
THE NATURE OF THE PURCHASE
• REPEAT PURCHASE• MODIFIED REPEAT PURCHASE• NEW REQUIREMENT• THE SIZE OF PURCHASE• THE MARKET CONDITION
PURCHASE-SUPPLIER RELATIONS
THE NATURE OF THE RELATIONSHIP BETWEEN THE TWO ORGANIZATIONS IS
A MAJOR INFLUENCER OF THE ULTIMATE VALUE AND CUSTOMER
SATISFACTION ACHIEVABLE.
PURCHASE-SUPPLIER RELATIONS
OUTSTANDING SUPPLIER PERFORMANCE NORMALLY REQUIRES EXTENSIVE
COMMUNICATION AND COOPERATION BETWEEN VARIOUS REPRESENTATIVES OF THE
BUYING ORGANIZATION AND THE SELLING ORGANIZATION OVER A LONG PERIOD OF
TIME.
PURCHASE-SUPPLIER RELATIONS
BRINGING NEW SUPPLIERS OUTSTREAM IS EXPENSIVE AND IS OFTEN ACCOMPANIED BY A PERIOD OF LEARNING AND AGGRAVATION FOR
BOTH SIDES.
PURCHASE-SUPPLIER RELATIONS
SYSTEM AND PHILOSOPHICAL COMPATIBILITY BETWEEN PURCHASER AND SUPPLIER HAS
BECOME MORE VITAL AS WAYS AND MEANS ARE FOUND TO SHORTEN THE TIME TAKEN FROM REQUISITION TO ACTUAL RECEIPT OF
THE ORDER.
PURCHASE-SUPPLIER RELATIONS
SUPPLIER GOODWILL
GOOD SOURCES OF SUPPLY ARE ONE ASSURANCE OF GOOD QUALITY TODAY, PROGRESSIVE THINKING AND PLANNING IS A FURTHER
ASSURANCE OF IMPROVED QUALITY TOMORROW.
PURCHASE-SUPPLIER RELATIONS
SUPPLIER GOODWILL
THIS GOODWILL HAS BEEN CULTIVATED THROUGH THE DEVELOPMENT OF TRADEMARKS AND
BRANDS, THROUGH EXTENSIVE ADVERTISING AND SALE PERSONNEL.
( RELATIONSHIP MARKETING)
PURCHASE-SUPPLIER RELATIONS
SUPPLIER GOODWILL
NO COMPANY CAN BE WORLD CLASS IF IT DOES NOT MEASURE ON A REGULAR BASIS
THE SATISFACTION LEVEL OF ITS KEY SUPPLIERS AND TRY TO IMPROVE
CONSTANTLY ON ITS RELATION WITH ITS SUPPLIER.
PURCHASE-SUPPLIER RELATIONS
PURCHASE-SUPPLIER RELATIONS
UNACCEPTABLE SUPPLIER
ACCEPTABLE SUPPLIER
PREFERRED SUPPLIER
EXCEPTIONAL SUPPLIER
PURCHASE-SUPPLIER RELATIONS
UNACCEPTABLE SUPPLIER
ACCEPTABLE SUPPLIER
PREFERRED SUPPLIER
EXCEPTIONAL SUPPLIER
Unacceptable supplier fail to meet operational and
strategic needs of the buying organization.
PURCHASE-SUPPLIER RELATIONS
UNACCEPTABLE SUPPLIER
ACCEPTABLE SUPPLIER
PREFERRED SUPPLIER
EXCEPTIONAL SUPPLIER
Acceptable supplier meet current need as required
by contract.
PURCHASE-SUPPLIER RELATIONS
UNACCEPTABLE SUPPLIER
ACCEPTABLE SUPPLIER
PREFERRED SUPPLIER
EXCEPTIONAL SUPPLIERBoth parties work toward mutual improvements to
eliminate nonvalue adding activities.
PURCHASE-SUPPLIER RELATIONS
UNACCEPTABLE SUPPLIER
ACCEPTABLE SUPPLIER
PREFERRED SUPPLIER
EXCEPTIONAL SUPPLIERExceptional suppliers anticipate
operational and strategic needs of the purchaser and are capable of
meeting and exceeding them.