chapter 2 creating and managing supplier relationship

Question 1

Explain the importance of supplier partnerships

Answer 1

One of the fundamental objectives of effective supply chain management is ensuring an integrated approach and coordination among the various stakeholders in the supply chain. Relationships with all supply chain partners must be developed in such a way as to become more meaningful. This will contribute to the supply chain achieving its objectives

Question 2

Understand the key factors for developing successful partnerships

Answer 2

1. building trust
2. shared vision and objectives
3. good interpersonal relationship between the partners
4. MUTUAL BENEFITS AND NEEDS
5. COMMITMENT AND TOP MANAGEMENT SUPPORT
6. When different companies work together there are always challenges or different cultures and staff members that may feel insecure.
7. INFORMATION SHARING AND LINES OF COMMUNICATION
8. Before companies decide to form a supplier relationship, they need to determine the supplier’s capabilities and core competencies
9. PERFORMANCE METRICS
10. CONTINUOUS IMPROVEMENT

Question 3

Develop a supplier evaluation and certification program

Answer 3

1.Select key dimensions,
2.Monitor and collect performance data,
3.Assigns weights to each dimension of performance based on their relative
importance,
4.Evaluate each of the performance measures using a rating scale,
5.Multiply dimension ratings with their respective importance weights to get to an
overall weighted score,
6.Classify vendors based on their overall scores,
7.Audit and ongoing certification review

Question 4

Explain the importance of a supplier recognition program

Answer 4

When recognising suppliers for excellent service it encourages other suppliers of the company to improve the service that they offer.

Question 5

Understand the capabilities of Supplier Relationship Management

Answer 5

• Automation of transactional processes,
• Integration that provides a holistic view of the supply chain,
• Visibility of information and process flows in and between organisations,
• Collaboration through information sharing,
• Optimisation of process and decision-making through analytical tools.

Question 6

Explain the benefits of using SRM software to manage suppliers

Answer 6

improved procurement efficiency, lower business costs, real time visibility, faster communication between buyer and seller and enhanced supply chain collaboration.

Question 7

what is supplier certification

Answer 7

supplier certification is an organisation’s process for evaluating the quality system of key suppliers in an effort to eliminate incoming inspections.

Question 8

discuss possible reasons for a supplier recognition program

Answer 8

Improving supplier performance,
* Reducing costs,
* Resolving serious quality issues,
* Developing new routes to supply,
* Improving business alignment between the supplier and the buying organisation,
* Developing a product or service not currently available in the marketplace,
* Generating competition for a high price product or service,
* Dominating the marketplace.

Question 9

discuss the seven step approach to developing suppliers

Answer 9

1. Identify critical goods and services,
2. Identify critical suppliers not meeting performance requirements,
3. Form a cross-functional supplier development team,
4. Meet with top management of suppliers
5. Rank supplier development projects,
6. Define the details of the buyer-supplier agreement,
7. Monitor project status and modify strategies