Automotive

Corporate culture does matter... especially for Supplier Collaboration

Corporate culture does matter... especially for Supplier Collaboration

We recently discussed the impact of culture on an organization’s effectiveness, a topic that has been debated for years. Current research shows empirical evidence that culture does matter. The area where culture impacts a company’s effectiveness most may be the area of supplier collaboration. 

The importance of the supply base is well understood. However, if the culture of a company says they play a “win/lose” game with suppliers, that suppliers should be ridden hard/ not coddled, or that supplier margins are profit opportunities to go after, then no Supplier Collaboration program can be effective.

Supply chain challenges in a world of uncertain commodity prices

Supply chain challenges in a world of uncertain commodity prices

A recent article in the McKinsey Quarterly shows how the past eight years have cancelled the steady decline in commodity prices over the previous century. The decline in prices over the past century was achieved despite demand jumping by 600 to 2,000 percent, through dramatic improvements in exploration, extraction and cultivation techniques. As a result, over the 20th century, we coped with a 20-fold increase in the world economy while prices fell.

The situation going forward will not be the same. The three factors that are causing the change are:

Want to Succeed in Asian Markets? Supplier Collaboration is Key.

Want to Succeed in Asian Markets? Supplier Collaboration is Key.

A 2009 global study by Vantage Partners of customer supplier negotiations and contracts “found that suppliers in Asia report that they are only able to deliver, on average, 59 percent of the total potential value of their contracts with customers.  (Supplier Collaboration in Asian Markets, My Purchasing Center)

“Suppliers laid much of the responsibility at the feet of their customers, citing unclear requirements, frequent changes to specifications, inaccurate and late forecasts, and failure to provide adequate staff access and support as primary explanations for under-delivery.

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