Companies can enhance quality improvement initiatives and realize terrific savings by requiring suppliers to develop and implement internal quality programs and meet cost requirements, according to research by benchmarking firm Best Practices, LLC.
But, how do leading companies effectively enforce the requirements?
Tactics in the Best Practice Database help companies in managing their supplier performance in a highly-effective manner. Available for download, a free sample document details practices such as:
— A Baldridge award winning company’s vendor certification program is a critical part of its Vendor Quality Improvement Program: Once a supplier is selected to participate in the Vendor Improvement Program, it is expected to establish its own quality program. The vendor can then take a focused approach to quality improvement within its organization. Suppliers’ Vendor Improvement Program implementation plans must contain:
— A highly detailed plan for quality program deployment
— Product specifications
— A comprehensive problem solving program that addresses root causes, not merely symptoms
— Preventive, not reactive, quality steps
— Another company implemented a supply chain management initiative with the goal of achieving continuous productivity gains of 6%. To achieve this goal, the company drastically reduced its base of 9,500 suppliers. The company summoned a meeting with 1,500 suppliers, where it outlined its requirements. Suppliers were expected to:
— Develop credible plans to reduce their prices by 10% to 15%.
— Develop credible plans to reduce lead times by 30%.
— Continue to meet rigid quality standards.
Chosen suppliers are now rewarded with a long-term contract, early involvement in new product design, help introducing TQM at their own companies, and electronic links with the company to cut down on paperwork. This partnership has brought down costs on both sides, in addition to prices.
These practices – along with primary research drawn in the form of hundreds of supply chain metrics, leading management practices, insights and lessons learned – are contained in Best Practice Database. Members of this Database include industry leaders such as:
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