Supplier Partnership

1. Supplier Partnership Presented by Dr. Joan Burtner Certified Quality Engineer Associate Professor of Industrial Engineering and Industrial Management Mercer University

2. Introduction • Supplier quality can substantially affect the cost of a service or product • “Customers and suppliers have the same goal – to satisfy the end user” • Deming’s influence • Stop awarding business based on price alone • Develop long-term relationships by using single suppliers • Other trends after 1980 • Just-in-time philosophy • Continuous process improvement • Acceptance of ISO 9000 Dr. Joan Burtner, Associate Professor of Industrial Engineering

3. Customer and Supplier Partnering • Long-term commitment • Problem solving takes time • Total organizational involvement required • Suppliers may be reluctant to make large investments without long-term commitment • Trust • Non-adversarial relationship required • Open and frequent communication strengthens the relationship • Shared vision • Need to satisfy the final customer • Each partner should understand the other’s business • Mutual strategic planning will benefit both parties Dr. Joan Burtner, Associate Professor of Industrial Engineering

4. Sourcing • Sole:The organization is “forced” to use only one supplier. • Single:The organization chooses to select one supplier for an item when more than one supplier is available. • Potential advantages: reduced business and production cost, better end product with reduced variability, better accountability, more loyalty • Potential threat: delivery disruption • Multiple:The organization uses two or more suppliers for a specific item. • Competition will result in better quality, better service, lower costs • May eliminate disruption of supply due to strikes, etc. Dr. Joan Burtner, Associate Professor of Industrial Engineering

5. Selection Decisions • Decision #1: produce in-house or outsource • If decision to outsource is chosen • Develop criteria for selection • Send multifunctional team to assess suppliers before making final choice Dr. Joan Burtner, Associate Professor of Industrial Engineering

6. Certification • Starts after supplier begins shipment of the product • Based on mutually-developed unambiguous specifications • Relies on a predetermined process for dealing with nonconformities • Requires that the supplier has a fully-documented quality system • Identifies who is responsible for conducting inspections and tests • Suppliers may be decertified as a result of major problems Dr. Joan Burtner, Associate Professor of Industrial Engineering

7. Supplier Rating System • Supplier rating system is designed to provide • Metric: overall rating of supplier performance • Systematic communications regarding quality, service, and delivery • Factual record of problems for corrective action • Positive relationship between customer and supplier • Successful supplier rating system requires • Internal structure to implement and sustain the rating program • Regular and formal review process • Standard measurement system for all the suppliers Dr. Joan Burtner, Associate Professor of Industrial Engineering

8. Contact Information • Email: Burtner_J@Mercer.edu • US Mail: Mercer University School of Engineering 1400 Coleman Avenue Macon, GA • Phone: (478) 301- 4127 Dr. Joan Burtner, Associate Professor of Industrial Engineering