From Supplier Management to Collaboration

supply chain management

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Una colaboración ‘win-win’ es la clave del éxito de cualquier relación

Especially, in the case of organizations and their suppliers. Today, that means going through the path that goes from ‘simple’ Supplier Management to Full Collaboration with them and the promotion of Innovation.

Too often, innovation and knowledge have been considered internal issues, in all kinds of organizations on the planet. Fortunately, this endogamic behavior has changed in recent years, giving way to a much more mature relationship between companies and their suppliers, so that they share knowledge and objectives, but also risks, dangers and setbacks. What we call ‘Supplier Collaboration and Innovation’ (SCI) as an appropriate methodology for dealing with supplier relationships is one of the most powerful tools for driving profitability, increasing savings and reducing risk.

Let me introduce an example at this point, from 1989, more than 30 years ago, when Chrysler, fighting for its survival, called on its largest suppliers for ideas, suggestions and thoughts on how to improve productivity, but, like Bob Lutz, President of Operations, he warned, “wanting your brainpower, not your margins.” This led Chrysler to create the SCORE (Supplier Cost Reduction Effort) project that produced billions in savings over the next decade. Suppliers were asked to provide insights and ideas on how to improve the product development process, moving their role from supplier to partner and stopping the unfortunately all too widespread behavior of ‘suppliers have to do what we tell them to do’ ‘.

This is collaboration and this is innovation, as the SCORE program brought Chrysler relevant savings and therefore benefits and a competitive advantage over competitors, but also a new way of thinking, communicating and sharing with its partners, leaving them to be “simple” providers.

The collaboration and innovation of suppliers does not in any way replace the diversity of cost reduction tools, methodologies and processes, but rather it is reinforcing them, increasing the viability to reduce them more in the short term and improve the benefits, in the long term, and acting accordingly in the income statement both from the reduction of costs and the increase in income. Loyal collaboration with suppliers, involving them in our business processes and transparently sharing our goals and objectives, but also risks, together with attracting as much innovation as possible from them, are the key success factors to guarantee long-term savings. deadline and quality.

¿Os gustaría que un montón de nuevas ideas se convirtiera en nuevos proyectos que aportaran ahorros sostenibles y nuevos beneficios?

Ultimately, gathering information and fostering supplier innovation is all about sharing and communicating. Would you like a bunch of new ideas to turn into new projects that bring sustainable savings and new benefits? I’m sure yes. To do this, gather your most relevant suppliers in a room, share with them your business or strategic plans, even your goals and objectives, and you will be pleasantly surprised by the avalanche of initiatives and creative projects that can probably be launched, reaching your goals as an organization.

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