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An email to J.B. Smith

February 26, 2018

J.B. Smith, I think you did a good job of recognizing the pitfalls of the production painting project you were contemplating. You recognized the potential trap you could find yourself in because that particular supply chain  was not built for supplier success. The problem with today's supply chain management is the crap keeps being pushed downhill making it increasingly difficult as a supplier to meet customer demands. Traditionally when Toyota decides on a supplier they want the supplier to succeed and will work with the supplier to see that they do succeed. When American companies try to use the Toyota manufacturing process they do not understand the concept of working with their suppliers to see that they succeed in the supply chain. The American philosophy is we selected you as a supplier now succeed or else.

Just as companies are looking to find "qualified" suppliers in my opinion suppliers should be looking to find "qualified" companies/customers to do business with and when I say qualified is the company willing to work with you as a supplier to succeed and are their vendor contracts so onerous as as to not be tenable. Personally I feel like it is better to be first tier supplier to a manufacturer than to be a second tier or third tier supplier for the very reason the crap increases and the margins decrease the further you get from the end manufacturer.

Part of the crap that I am talking about is lack of information to do the job. As we discussed with PPI not automatically sending print revisions along with a purchase order or at least making a system where as the supplier could log onto their system and download revisions as needed. (PPI was purchased by AC company) and at the end of our association with the company purchasing was going to stop putting the material requirements and other necessary information for the supplier on the purchase orders. In this example the reason given was that the materials were listed on the print.  This was a false premise in that AC company prints always called for Lexan and PPI when it existed as a supplier to AC company substituted Kydex for Lexan on those parts. When the purchasing agent made the change to purchase orders we as a supplier would not have the necessary reliable information to complete the order. A good supply chain customer will make clear what is needed to make parts and will work with you to improve the flow of information. If there is a systemic lack of information passed to suppliers I would beware of that company. Many times purchasers are using the power of their position to get lazy.

 

A purchasing department that is complaining that they are overwhelmed by managing the supply chain is doing just that managing and not leading from the top down. Suppliers are willing to take on more responsibility provided the flow of information is sufficient and the relationship is one of teamwork and and not one that is adversarial.

MBM
 

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