supplier partnership part 2

SUPPLIER PARTNERSHIP

SUPPLIER PARTNERSHIP

DEFINITION:

Supplier Partnership is the discipline the strategically planning

for, and managing, all interactions with third party organization

that supply good and or/ service to your organization, in order to

maximize the values of those interactions.

SUPPLIER PARTNERSHIP INTRODUCTION:

An organization (or customer) purchases its

requirements, raw materials, components, and

services, from supplier.

Better supplier’s quality Better product’s quality

A partnership between customer

and supplier is one of the keys to

obtaining high quality products

and services. Customers and

suppliers have the same goal –to

satisfy the end user. They must

work together as partners to

maximize the return on

investment because they have

limited resources.

REASONS FOR PARTNERSHIP

QUALITY AND TIMELY DELIVERY

JIT CONCEPT:

It calls for raw materials and

components to reach the

production operation in small

quantities when they are needed

and not before.


PRACTICE OF CONTINUOUS PROCESS IMPROVEMENT:

The practice of continuous process

improvement has also caused many

suppliers to develop partnerships with

their customer.


QUALITY ASSURANCE SYSTEMS (ISO 9000, ETC.)

ISO 9000 can help a company

satisfy its customers, meet

regulatory requirements, and

achieve continual improvement.

But it’s a first step, many quality

professionals will tell you, the

base level of a quality system,

not a complete guarantee of

quality.


PRINCIPLES OF CUSTOMER/SUPPLIER RELATIONS

Both the customer and the supplier are fully

responsible for the control of the quality.

Both the customer and the supplier should be independent of

each other and respect each other’s independence.


The customer is responsible for providing the supplier with clear and

sufficient requirements so that the supplier can know exactly what to

produce.


Both the customer and the supplier should enter a contract with

respect to quality, quantity, price, delivery method, and terms of

payments.


The supplier is responsible for providing the quality that will satisfy the

customer and submitting necessary related with customer’s needs.


Both the customer and the supplier should

decide the method to evaluate the quality

of the product or service to satisfaction of

both parties.

Both the customer and the supplier should

continually exchange information,

sometimes using multifunctional teams, in

order to improve the product or service

quality.


Both the customer and the supplier should perform business activities

such as procurement, production and inventory planning, and etc.


When dealing with business transactions, both the customer and

the supplier should always have the best interest of the end

user in mind.


PARTNERING

Partnering is along-term

commitment between two or more

organizations for the purpose of

achieving specific business goals

and objectives by maximizing the

effectiveness of each participant’s

resources.

BENEFITS:

Improved quality

Increased efficiency

Lower cost

Increased opportunity for

innovation

Continuous improvement of

products or services

PARTNERING

Key Elements to a partnering Relationship:

LONG-TERM COMMITMENT:

Long-term commitment provides the

needed environment for both parties to

work toward continuous improvement.

PARTNERING


TRUST:

Trust enables the resources and

knowledge of each partner to be

combined to eliminate an adversarial

relationship. Partners are then able to

share information and accept reduced

control. Mutual trust forms the basis for

a strong working relationship.

PARTNERING


SHARED VISION:

Each of the partnering organizations

must understand the need to satisfy the

final customer. Shared goals and

objectives ensure a common direction

and must be aligned with each party

mission.

PARTNERING

SOURCING

SOURCING

There are three types of sourcing

SoleMultipleSingle

TYPES OF SOURCINGSOLE A sole source of supply implies

that the organization is forced to

use only one supplier. This

situation is due to factors such as

patents, technical specification,

raw material location, only one

organization producing the item,

or the item being producing by

another plant or division of the

organization.

MULTIPLE:

Multiple sourcing is the use of

two or more suppliers for an

item. Usually three suppliers

are chosen, and their portion of

the business is a function of

their performance in term of

price, quality, and delivery.

TYPES OF SOURCING

SINGLE:

Single sourcing is a planned decision by the organization to select

one supplier for an item when several sources are available. It

results in large, long term contracts and a partnering relationship.

TYPES OF SOURCING

Benefits for organization:

Reduced business and production costs

Complete accountability

Supplier loyalty

Better end product with less variability

Benefits for supplierNew business from the customer

Reduced the cost of business

Production processes

SUPPLIER SELECTION

Before discussing supplier activities. It must be decided whether to

produce or outsource a particular item.

The following three questions need to be answered:

How critical is the item to the design of the product or service?

Does the organization have the technical knowledge to produce the

items internally? If not, should that knowledge be develop?

Are there suppliers who specialize in producing the item? If not, is

the organization willing to develop such a specialized supplier?

CONDITION OF SUPPLIER SELECTION

There are following condition for selection of supplier

The supplier understand and appreciate the management philosophy

of the organization.

The supplier has a stable management system. And ask several

question should be asked:

Is there a quality policy statement that includes objectives for quality

and its commitment to quality?

Is the policy implemented and understood at all levels of the

organization?

Is there documentation that indicates who is in charge and

responsible for quality in the organization?

The supplier maintains high technical standards and has the capability

of dealing with feature technological innovations.


The suppliers can provide those raw materials and parts required

by the purchaser and those supplied meet quality specifications.


The supplier has the capability to produce the amount of

production needed.


There is no danger of the supplier breaching corporate secrets.

The price is right and delivery dates can be meet. The supplier implements contract provisions.


The supplier has an effective quality system and

improvement program such as ISO/QS 9000.


The supplier has a track record of customer satisfaction and organization credibility.


supplier partnership part 2

Economy & Finance

partnership quality

service quality

quality system

quality professionals

high quality products

complete guarantee of

quality assurance systems

raw materials