Should We Partner With Suppliers?

The Procurement Leaders have an insightful blog up on Partnering called Is Partnering With Suppliers Overhyped?

It is worth reading and just click on the title above to get it. They note that results of partnering have not been clearly good.  They go on to say that the reason is that Suppliers have actually used the relationship strategically, but the Customers have talked about being strategic but acted tactically losing freedom and higher level benefit at one blow.

Well said.  As customers, we can be too proud and fail to discipline our efforts to be strategic leaving purchasers to make tactical moves within their scope.

Another problem that occurs is when companies partner with suppliers who do not share their values. Assumptions exist in the buyers that they are ‘like us” when they are not.  Or no trust actually exists because agendas are not transparent, and so nothing strategic can emerge.

Partnering with suppliers is actually powerful when used well. I would like to recommend a book by the Harvard Business Review called Harvard Business Review on Supply Chain Management. In the article on building “Deep Supplier Relationships,” they lay out how Japanese automakers defeated the American car makers.   In America, the Japanese partnered with suppliers in America while the US Automakers just beat suppliers down.  There is also an excellent review of the whole book at Husdal .com.  Find the review here

Partnering with suppliers has not met expectations, but the problem lies in our poor implementation of good principles. The principles are still good. When we sit on the same side of the table with the right suppliers, we will have strategically better results.


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Posted in: Leadership, Sourcing

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