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Supplier Development Barriers (Supplier-specific Barriers (1. Lack of…
Supplier Development Barriers
Buyer-specific Barriers
1. Buying company's purchase volume from the suppliers doesn't justify development investment
Solution
Standardisation & single sourcing to increase purchase volume
2. Buyer might not receive the benefits in short-term but only for long-term
Solution
Pursue small wins, focus on smaller achievements
3. Importance of purchased item doesn't justify development efforts
Solution
Take a longer term focus
Look beyond price & examine quality & technology of supplier's products
4. Lack of executive support within firm for supplier development
Solution
Prove the benefits
Buyer-Supplier Interface Barriers
1. Supplier reluctant to share information on costs / process
Solution
Create a supplier ombusdsman ( 3rd party personnel)
To act as a liaison between 2 companies, build up supplier's trust
2. Confidentiality inhibits information sharing
Solution
Establish confidentiality agreements
3. Supplier doesn't trust buyer
Solution
Spell it out
To have the terms specifically written out & signed
4. Organisational Cultures are poorly aligned
Solution
Adapt new approach to local conditions
To provide supplier manual
5. Not enough Inducement provided for Supplier to participate
Solution
Designed-in motivation: incorporate supplier's products into designs
Financial incentives as motivation for improvement
Supplier-specific Barriers
1. Lack of Commitment on Supplier's management part
Solution
Implement only after supplier demonstrate its commitments
2. Supplier's management agree to improve but Fails to implement proposal
Solution
Supplier Champions
Process mapping, failure mode effects analysis
Quality Control Planning
Best-practices benchmarking
Process auditing
3. Supplier lacks engineering resources to implement resources
Solution
Direct Support
4. Supplier lacks required information systems
Solution
Direct EDI support
provide training & recommendations on software & hardware purchases
5. Supplier are not convinced development will provide benefits to them
Solution
Let suppliers know where they stand
allow suppliers to view their performance against to competitors' performance
6. Supplier lacks employee skill base
Solution
Establish training centres