SCM Chapter 9 2nd Supply Development

Triage Approach

80/20 rule

Competencies Staircase

Score card

More qualified suppliers

Supply disruption​

Absence of Competition

Less competition

Greater flexibility

Reduce cost

Higher costs

Increased risk

Location

Brand reputation

Delivery times

Price only

Monitor Status of Projects and Modify Strategies as Appropriate​

Define Key Metrics and​Cost-Sharing Mechanisms​​

Identify Opportunities and​ Probability for Improvement​

Identify Critical Suppliers​

True

False

Lower cost

Vision and commitment

Immediate benefits

High turnover

7

8

9

10

Importance of purchased item does not justify development efforts​​

Supplier lacks engineering resources to implement solutions​

Supplier lacks required information systems​​

No immediate benefit to supplier development is evident to buyer​

Lower Total Product Cost​

• Buying from world-class suppliers​

• Reduction of supply base risk​

• Overaggressive supply reduction​