Tell us more. Was the final answer of the question wrong? Were the solution steps not detailed enough? Was the language and grammar an issue? Didn't find yours? Ask a new question Get plagiarism-free solution within 48 hours. Review Please. Next Previous. Related Questions. Describe the differences between vendor-managed inventories and co-managed inventories, and when it might be advisable to do either of them.
What is the What is a Supplier Council? What role does a Council have in supporting the strategic supplier alliance between Whirlpool Corporation and Inland Steel? Create an Account and Get the Solution. Log into your existing Transtutors account. Have an account already? Click here to Login. No Account Yet? Click here to Sign Up. Sign in with Facebook. Looking for Something Else? If the relationship decision involves a channel partner such as a supplier or customer, the focus is not so much on whether or not to have a relationship but on what type of relationship will work best.
In either case, the question as to what type of relationship is most appropriate is one that is very important to answer. Lambert, Ernmelhainz, and Gardner have conducted significant research into the topic of how to determine whether a partnership is warranted and, if so, what kind of partnership should be considered. Although other factors may certainly be considered, the primary drivers include the following:.
Included among the main types of facilitators are the following:. In addition, a number of additional factors have been identified as keys to successful relationships. Included are factors such as exclusivity, shared competitors, physical proximity, prior history of working with a partner or the partner, and a shared high-value end user.
Although the details are not included here, Lambert and his colleagues suggest a method for measuring and weighting the drivers and facilitators that we have discussed. Then, they discuss a methodology by which the apparent levels of drivers and facilitators may suggest the most appropriate type of relationship to consider.
Alternatively, when all parties to the relationship share common drivers, and when the facilitating factors seem to be present, then a more structured, formal supplier relationship management may be justified. This task should be supported with not only the availability of critical measurements and so on, but also the results of personal interviews and discussions with the most likely potential partners.
Although logistics executives and managers usually have significant involvement in the decision to form logistics and supply chain relationships, it is frequently advantageous to involve other corporate managers in the overall selection process.
Representatives of marketing, finance, manufacturing, human resources, and information systems, for example, frequently have valuable perspectives to contribute to the discussion and analysis. Thus, it is important to ensure a broad representation and involvement of people throughout the company in the partnership formation and partner selection decisions.
While this stage is of critical concern to the customer, the selection of a logistics or supply chain partner should be made only following very close consideration of the credentials of the most likely candidates. Also, it is highly advisable to interact with and get to know the final candidates on a professionally intimate basis.
As was indicated in the discussion of Step 3, a number of executives will likely play key roles in the supplier relationship management formation process. Due to the strategic significance of the decision to form a logistics or supply chain relationships, it is essential to ensure that everyone has a consistent understanding of the decision that has been made and a consistent expectation of what to expect from the firm that has been selected. The structure of the relationship refers to the activities, processes, and priorities that will be used to build and sustain the relationship.
Once the decision to form a supplier relationship management has been made and the structural elements of the relationship identified, it is important to recognize that the most challenging step in the relationship process has just begun. Depending on the complexity of the new relationship, the overall implementation process may be relatively short, or it may be extended over a longer period of time.
In a situation where the degree of change is more modest, the time needed for successful implementation may be abbreviated. Finally, the future success of the supplier relationship management will be a direct function of the ability of the involved organizations to achieve both continuous and breakthrough improvement.
A number of steps should be considered in the continuous improvement process. Michael Hammer, collaboration allows companies to leverage each other on an operational basis so that together they perform better than they did separately.
While this approach creates a synergistic business environment in which the sum of parts is greater than the whole, it is not one that comes naturally to most organized particularly those offering similar or competing products or services.
Also, it makes sense, considering -entailers routinely commingle competing products as they are transported from distribution centers to retail stores. When organizations refuse to collaborate, real losses may easily outweigh perceived gains. North America. United Kingdom.
Contact us. What is Supplier Management? Usually, it involves contractual fulfillment only, with little or no interaction beyond communicating the requirement and fulfillment.
Ongoing relationship — A formally- or informally-recognized status where one supplier is selected in preference over others. There tends to be more sharing of information and a comparatively solid relationship between both parties. Partnership — Traditionally, a longer-term contract than the above, partnerships are defined by their increased trust and extensive sharing of information and commercial goals, especially compared to ongoing relationships.
Strategic alliance — A long-term relationship in which both parties have agreed to work together, usually with some sort of exclusive arrangement, with defined commercial objectives and targets. Whether the arrangement is formal or informal, there may also be incentives between the two. Requires a close degree of collaboration in order to realize potential, typically day-to-day interaction.
Backward integration — This relationship involves the organization owning the supplier outright as part of their business. As a result, there is a unified culture and, ideally, full sharing of information and plans. Essentially, supplier and organizations are one and the same. What is supplier relationship management? What is supplier lifecycle management? What is supplier information management?
What does the supplier management process flow involve? Step 1: Qualification — Qualification involves the evaluation of suppliers to determine if they are capable enough to provide the necessary goods or services to the standards set by the buyer.
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