© Alan Harrison and Remko van Hoek 2008
Slide 9.1
Working together
Purchasing and supply relationships
© Alan Harrison and Remko van Hoek 2008
Slide 9.2
Purchasing and supply relationships
• Choosing the right relationship
• Partnerships in the supply chain
• Supply base rationalisation
• Supplier development
• Implementing partnerships
© Alan Harrison and Remko van Hoek 2008
Slide 9.3
Figure 9.1 Relationship styles continuumSource: After Cooper and Gardner, 1993
© Alan Harrison and Remko van Hoek 2008
Slide 9.5
Partnerships in the supply chain
Is based upon:
• the sharing of information
• trust and openness
• coordination and planning
• mutual benefits and sharing of risks
• a recognition of mutual interdepence
• shared goals
• compatibility of corporate philosophies
© Alan Harrison and Remko van Hoek 2008
Slide 9.7
Disadvantages of partnerships
• inability to price accurately qualitative matters such as design work
• the need for organisations to gather substantial information
• choosing the wrong partner
• risk of giving sensitive information to competitors
• potential opportunism by suppliers
• other things?
© Alan Harrison and Remko van Hoek 2008
Slide 9.8
Supplier base rationalisation
Reduce number of suppliers to develop high-intensive relationships – is difficult with many suppliers
Supplier management deals with organising the soursing of materials and components from a suitable set of suppliers
© Alan Harrison and Remko van Hoek 2008
Slide 9.10
Supplier associations
• the network of a company´s important suppliers brought together for the purpose of coordination and developement.
© Alan Harrison and Remko van Hoek 2008
Slide 9.11
Table 9.1 Primary objectives for establishing and developing supplier associations
© Alan Harrison and Remko van Hoek 2008
Slide 9.12
Table 9.1 Primary objectives for establishing and developing supplier associations (Continued)
© Alan Harrison and Remko van Hoek 2008
Slide 9.13
Supplier development
• It is important that the partnerships develop – hence the choosen suppliers needs to develop
• Integrated processes – alignment of critical processes
• Synchronous production
© Alan Harrison and Remko van Hoek 2008
Slide 9.14
Implementing strategic partnerships
• What makes it a challenge?
© Alan Harrison and Remko van Hoek 2008
Slide 9.15
Implementing strategic partnerships – cont.
• Power structure is not equal
• Buyers highligts risk
• Opportunism from either partner
• Self-interest
• Focus on price