Supplier partnerships are strategic relationships between organizations to maximize the value of interactions with suppliers. Effective partnerships require long-term commitment, trust, and shared goals. Partners work together to improve quality, efficiency, and innovation. Key elements include commitment, trust, shared vision, and benefits like lower costs and improved products. Organizations must select suppliers strategically by evaluating management, quality systems, pricing, and track record. The goal is satisfying end customers through strong customer-supplier relationships.

3. SUPPLIER
PARTNERSHIP

4. SUPPLIER
PARTNERSHIP
 DEFINITION:
 Supplier Partnership is the discipline the strategically planning for,
and managing, all interactions with third party organization that
supply good and or/ service to your organization, in order to
maximize the values of those interactions.

5. SUPPLIER
PARTNERSHIP INTRODUCTION:
 An organization (or customer) purchases its
requirements, raw materials, components, and
services, from supplier.
 Better supplier’s quality  Better product’s quality

6.  A partnership between customer and
supplier is one of the keys to
obtaining high quality products and
services. Customers and suppliers
have the same goal –to satisfy the
end user. They must work together as
partners to maximize the return on
investment because they have limited
resources.

7. REASONS FOR
PARTNERSHIP
 QUALITY AND TIMELY DELIVERY

8. JIT CONCEPT:
 It calls for raw materials and
components to reach the production
operation in small quantities when
they are needed and not before.
REASONS FOR
PARTNERSHIP

9.  PRACTICE OF CONTINUOUS
PROCESS IMPROVEMENT:
The practice of continuous process
improvement has also caused many
suppliers to develop partnerships with
their customer.
REASONS FOR
PARTNERSHIP

10.  QUALITY ASSURANCE
SYSTEMS (ISO 9000, ETC.)
 ISO 9000 can help a company
satisfy its customers, meet
regulatory requirements, and
achieve continual improvement.
But it’s a first step, many quality
professionals will tell you, the base
level of a quality system, not a
complete guarantee of quality.
REASONS FOR
PARTNERSHIP

11. PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS
 Both the customer and the supplier are fully
responsible for the control of the quality.

12.  Both the customer and the supplier should be independent of each
other and respect each other’s independence.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

13.  The customer is responsible for providing the supplier with clear and
sufficient requirements so that the supplier can know exactly what to
produce.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

14.  Both the customer and the supplier should enter a contract with
respect to quality, quantity, price, delivery method, and terms of
payments.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

15.  The supplier is responsible for providing the quality that will satisfy the
customer and submitting necessary related with customer’s needs.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

16.  Both the customer and the supplier should
decide the method to evaluate the quality of
the product or service to satisfaction of both
parties.
 Both the customer and the supplier should
continually exchange information,
sometimes using multifunctional teams, in
order to improve the product or service
quality.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

17.  Both the customer and the supplier should perform business activities
such as procurement, production and inventory planning, and etc.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

18.  When dealing with business transactions, both the customer and
the supplier should always have the best interest of the end user in
mind.
PRINCIPLES OF
CUSTOMER/SUPPLIER RELATIONS

19. PARTNERING
 Partnering is along-term commitment
between two or more organizations
for the purpose of achieving specific
business goals and objectives by
maximizing the effectiveness of each
participant’s resources.

20.  BENEFITS:
 Improved quality
 Increased efficiency
 Lower cost
 Increased opportunity for
innovation
 Continuous improvement of
products or services
PARTNERING

21.  Key Elements to a partnering
Relationship:
 LONG-TERM COMMITMENT:
Long-term commitment provides the
needed environment for both parties to
work toward continuous improvement.
PARTNERING

22.  Key Elements to a partnering
Relationship:
 TRUST:
Trust enables the resources and
knowledge of each partner to be
combined to eliminate an adversarial
relationship. Partners are then able to
share information and accept reduced
control. Mutual trust forms the basis for a
strong working relationship.
PARTNERING

23.  Key Elements to a partnering
Relationship:
 SHARED VISION:
 Each of the partnering organizations
must understand the need to satisfy the
final customer. Shared goals and
objectives ensure a common direction
and must be aligned with each party
mission.
PARTNERING

24. SOURCING

25. SOURCING
 There are three types of sourcing
 Sole
 Multiple
 Single

26. TYPES OF SOURCING
SOLE
 A sole source of supply implies
that the organization is forced to
use only one supplier. This
situation is due to factors such as
patents, technical specification,
raw material location, only one
organization producing the item,
or the item being producing by
another plant or division of the
organization.

27.  MULTIPLE:
 Multiple sourcing is the use of
two or more suppliers for an
item. Usually three suppliers are
chosen, and their portion of the
business is a function of their
performance in term of price,
quality, and delivery.
TYPES OF SOURCING

28.  SINGLE:
 Single sourcing is a planned decision by the organization to select one
supplier for an item when several sources are available. It results in
large, long term contracts and a partnering relationship.
TYPES OF SOURCING

29. Benefits for organization:
Reduced business and production costs
Complete accountability
Supplier loyalty
Better end product with less variability
Benefits for supplier
New business from the customer
Reduced the cost of business
Production processes

30. SUPPLIER SELECTION
 Before discussing supplier activities. It must be decided whether to
produce or outsource a particular item.
 The following three questions need to be answered:
 How critical is the item to the design of the product or service?
 Does the organization have the technical knowledge to produce the
items internally? If not, should that knowledge be develop?
 Are there suppliers who specialize in producing the item? If not, is the
organization willing to develop such a specialized supplier?

31. CONDITION OF SUPPLIER
SELECTION
 There are following condition for selection of supplier
 The supplier understand and appreciate the management philosophy of
the organization.
 The supplier has a stable management system. And ask several question
should be asked:
 Is there a quality policy statement that includes objectives for quality and
its commitment to quality?
 Is the policy implemented and understood at all levels of the
organization?
 Is there documentation that indicates who is in charge and responsible
for quality in the organization?

32.  The supplier maintains high technical standards and has the capability of
dealing with feature technological innovations.
CONDITION OF SUPPLIER
SELECTION

33.  The suppliers can provide those raw materials and parts required by
the purchaser and those supplied meet quality specifications.
CONDITION OF SUPPLIER
SELECTION

34.  The supplier has the capability to produce the amount of
production needed.
CONDITION OF SUPPLIER
SELECTION

35.  There is no danger of the supplier breaching corporate
secrets.
 The price is right and delivery dates can be meet.
 The supplier implements contract provisions.
CONDITION OF SUPPLIER
SELECTION

36.  The supplier has an effective quality system and improvement
program such as ISO/QS 9000.
CONDITION OF SUPPLIER
SELECTION

37.  The supplier has a track record of customer satisfaction and
organization credibility.
CONDITION OF SUPPLIER
SELECTION