Supplier Relationship

In the case analysis of Managing Supplier Quality, Integrated Devices’ Injected Molding Commodity Team responsible for conducting business and process interaction with

In a company like Voith, where more than half the value of a project is comprised of procured material versus in-house manufactured parts and labor cost, supply management and strategic sourcing have the potential to provide some of the most value-added benefits to the organization. The sourcing department within an organization has the fiscal responsibility to ensure that profit goals are not only met but exceeded. There is a direct impact on the bottom line of the project through positive or negative performance of the vendor (i.e., quality and on-time delivery) and through the negotiated price of the parts procured. Improving bottom line profit is accomplished by establishing specific sourcing strategies, tailored to each project’s requirements as defined by the customer’s needs, with the reduction of overall project cost as the focus. Voith puts a great deal of emphasis on cost

The supplier should make sure that he keeps in touch on the progress of the production of the products and inform of any delays, extra costs, or failure that make take place.

Maintain and assess suppliers’ performance and create relationships. Evaluate each supplier capacity and ability to perform as well as identifying and reducing the supply chain risks

Suppliers want steady orders and prompt payments. They also like to be valued by the company they supply for instead of their ‘last resort’.

- M&S rewards complying suppliers who promote continual improvement with the opportunity of co-development and long-term relationship advantages (training, share expertise and information...)

The article discussed is written by Lisa Arnseth: “Sharing Value with Suppliers,” Inside Supply Management Vol. 23, No. 4. The article begins by talking about the economic downtown was hard on everyone and when things started looking up in 2009, that some suppliers could still not recover. Suppliers were forced to make cutbacks which made it very difficult for them to stay in business. Some of the larger manufacturers decided to help their suppliers by sharing their financial expertise, capital, and their lean manufacturing knowledge to help pull them out of the rut. In today’s world, a shared value approach is beginning to take course. The article begins discussing Toyota, Hyundai Motor Company and Samsung. These companies are looked at

According to the Purchasing and Supply Chain Management textbook, “Supplier performance measurement includes the requisite methods and systems to collect and provide information to measure, rate, or rank supplier performance on an ongoing basis (324).” Bose has developed a detailed supplier performance system that measures on-time delivery, quality performance, technical improvements, and supplier suggestions (Schulz, 2016). Twice a month, Bose generates a report providing feedback to suppliers about their performance. If necessary, Bose uses these measurements to establish goals for improvement for that supplier to attain. It would be beneficial for

The power of suppliers is also analyzed and the relationship between the buyers and suppliers is determined. Managers can create strategies to reduce the cost of suppliers and create an efficient supply chain by this analysis.

An organization must select suppliers it can do business with over an extended period. The degree of effort associated with the selection relates to the importance of the required goods or services. Depending on the supplier evaluation approach used, the process can be an intensive effort requiring a major commitment of resources (such as time and travel). This section addresses the many issues and

To choose the best suppliers for our various components, all existing suppliers are evaluated. Cost per item, accounts payable (A/P) terms, actual delivery time, average days late on delivery, and total ordered quantity are calculated and compared. Because on time delivery is vital to our daily operation, delivery time and average days late are considered the most important criteria. Based on this evaluation, suppliers recommended for each component are listed below.

• Strong relationships with suppliers that offer credit arrangements, flexibility, and response to special product requirements

Partners: Nurture a winning network of customers and suppliers, together we create natural, enduring value.

The company uses target pricing for the parts they purchase from suppliers. To Honda, customer satisfaction is top priority which they accomplish through suppliers competitiveness in quality, cost, delivery, development, and management. Honda gives its suppliers target costs and it reduces the cost through own ideas, technology, and improved productivity. Exhibit 1 illustrates Honda’s supply chain.

Nurturing the relationships with the existing suppliers and new suppliers to ensure that they provide priority and best quality of service to you.