1 Building Stronger Customer-Supplier Relationships Kimball E. Bullington, Ph.D., P.E. Stanley F....
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Transcript of 1 Building Stronger Customer-Supplier Relationships Kimball E. Bullington, Ph.D., P.E. Stanley F....
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Building Stronger
Customer-Supplier
RelationshipsKimball E. Bullington, Ph.D., P.E.
Stanley F. Bullington, Ph.D., P.E.
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Why Long-Term Relationships?
• Increasing trend toward global supply
• Higher baseline performance
• Increasing focus on time to market
• Dependence upon suppliers for technology
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Why Long-Term Relationships?
A long-term relationship between purchaser and supplier is necessary for best economy. How can a supplier be innovative and develop economy in his production processes when he can only look forward to short-term business with a purchaser?
W. Edwards Deming, Out of the Crisis
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Why Long-Term Relationships?
• Trend toward LT contracts since 1990
• Pressure to reduce price
• Pressure to reduce transaction costs
• Consolidation pressures
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Challenges for a Useful SCR Model
• Relationships are critical
• Trust may be low
• Literature focuses on causes of failure
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Challenges for a Useful SCR Model
• Limited number of published SCR successes
• Successes could be culture-dependent
• Model should be simple & proven
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Family Strengths Research
• Strong families
• 20+ years of research
• Over 6,000 successful families surveyed
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Family Strengths Research
• Culturally diverse population
• Compares favorably with other taxonomies of family success
• Summarized in six characteristics
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Family Strengths Research6 Characteristics of Strong Families
• Commitment (trust)
• Good communication patterns
• Ability to deal with crises
• Spiritual wellness
• Spending time together
• Appreciation
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Six Characteristics of Successful SCR’s
• Commitment
• Good communication patterns
• Ability to deal with crises (change)
• Spiritual wellness (principles-centered)
• Spending time together
• Appreciation / feedback
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Commitment: Concerns
• Is this the right supplier?
• What about unequal commitments?
• Is management committed?
• What are the implementation issues related to maintaining commitment?
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Commitment: Implementation
• Selection prior to initiation
• Two-way criteria for success
• Regular performance reviews
• Management committed to proceed
• Participation requirements identified early
• Implementation of complete SCR model
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Matrix for SCR SelectionSurveillance (2) Long-Term
Relationship (1)
Transactional (4) Contractual (3)
Increasing Spend / Value Potential
Incr
easi
ng
Ris
k /
Com
ple
xity
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Communication: Concerns
• Replace face-to-face communication with technology?
• Good communication = $$$
• Communication between technical groups
• Role of agent
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Communication: Implementation
• Face-to-face communication increased & facilitated by multiple technologies
• Support for communication forums
• Triad as core team
• Agent investments in communication
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Dealing with Change
• New product development process
• Common improvement process
• Objective performance measures
• Conflict resolution by team leaders– commitment management– communication assurance
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Shared Principles
• Principles Centered Leadership
• Two-Way Performance Measures
• Follow-through on Commitments
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Spending Time Together
• Quarterly performance reviews
• Team building dinners
• Commitment to keep the schedule
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Appreciation
• Celebration of critical improvement
• Recognition distribution
• Other forms of recognition
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Buil ding S t r o ng C ust o mer -Suppl ierRel at io nships
Time To get herAppr ec iat io n/
Feedbac k
Capacityfor
Change
Capacityfor
Change
Strongcommitment
Strongcommitment
Commonpr incipl esCommon
pr incipl es
Excel l entCommunication
Excel l entCommunication
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Building Stronger Customer-Supplier
RelationshipsKimball E. Bullington, Ph.D.,
P.E.Middle Tennessee State
UniversityStanley F. Bullington, Ph.D.,
P.E.Mississippi State University