With recent sorry stories in the UK and
European media about adulterated beef containing Horsemeat, we return to the
theme of people in the Supply Chain (see "People make Supply Chains" in this blog).
Do you trust your Suppliers? If you don't then you have a problem,
but first of all what do I expect from a trustworthy supplier? First on the
list is that they send you what they have promised. I also expect honesty from
them when they have problems affecting that supply. Does that mean they should
tell me about every little twist and turn in their business or with their
suppliers? No.
What you pay a supplier for is to manage
those twists and turns, to solve their own problems. If you get involved then
you might as well ask for a discount! However there is a fine line in solving
your own problems and being up front with your customer when you have a serious
supply issue.
In the last few weeks one if my clients has
had to deal with one of their Suppliers that isn't delivering for them. I was
involved, and my biggest problem was that I didn 't trust what they told us, the
honesty had gone!
The Pharma industry has instituted Vendor
Assurance, site audits and certificates to confirm supply identity. This is
good and necessary, like self-inspections and keeping good fences with neighbours.
But if you look in the eye of your supplier and don't trust them, that's the
time to check for the Horse DNA!
1 comment:
There is trust in a supplier - which is vital I think - Its a human instinctive thing. Dealing with a supplier you don't trust is possible , but can take massive resource. Often it's just not worth it.
There is often a missmatch of risk between supplier and customer. It's worth exploring this. I use this this simple test " If the supplier fails to deliver on time, or to quality, what are the relative losses to both parties"
For some goods and services - this risk is roughly equal - As a customer - your issues are important enough to have a significant impact on their business - ( Perhaps if you go else where, or if their reputation is tied to yours)
For other goods and services - you are just another customer - your problems simply mean they lose a customer and need to find another - a few £100 of impact - while the customer could be out of business.
IT suppliers are often a classic example of this risk imbalance .
Lost server sale ( a few £1000) vs business unable to operate for 2 weeks ( £100,000)
The simple risk imbalance test is a great way to determine which suppliers you need to pay attention to
D
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