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The 3 Biggest Ideas to Systemize Working with Your Supply Chain Vendors

The 3 Biggest Ideas to Systemize Working with Your Supply Chain Vendors

We conclude our Managing Your Supply Chain Series with our 3 Biggest Ideas from the 10-Part Series and they’re all about systemizing your process for working with your Vendors.  If your company is anything like ours, you know that your Supply Chain Vendors are critical to your success.  Managing them well is important and even though they aren’t inside your building, there are some key practices you can employ so they feel like an extension of your Team.

Since we are both a Vendor to some companies and a Customer to others, we deal with both aspects of the challenges of keeping information and products flowing up and down the Supply Chain.

This week, we’re summarizing our Managing Your Supply Chain Series by highlighting the three biggest ideas to systemize how you work with your Supply Chain Vendors:

1. Build an Onboarding System for Having a Vendor Take on a New Job.

Vendor relationships may start out at arm’s length but hopefully they will develop into a more of a partnership over time.  Establishing consistent partners, particularly for the kinds of services you need on a regular basis, is key to your long-term success.  Knowing how important Vendors can be for your business, it’s important that you treat them that way!  It’s easy to treat Vendors as if they are commodity suppliers with very little extra value to provide, but with a little effort and consideration, you can have Vendors eager to provide additional support and performance.

As part of your onboarding system, you should spend specific time with your Vendor’s Team to think and talk through the project in detail.  Getting the specifics out on the table shows your Vendor that they are important to you and you want to make sure everything will work out well on the project.  It will help prevent surprises as the project unfolds, and surprises are almost universally bad when they happen within the Supply Chain.

Yes, it takes longer to create this conversation with your Vendor, but it is more professional and will save considerable time and energy over the life of your projects and the longer-term potential partnerships with your Vendors.

One additional way that communication prior to the start of a project can benefit you is if you make a regular habit of asking your Vendors for options they see that might improve any aspect of the project from their perspective.  Getting used to soliciting their input won’t always provide helpful solutions, but they’ll appreciate being asked and they may come up with a great idea that you didn’t see.

2. Build a Communication System for Interacting Consistently with Your Vendors from Purchase Order to Delivery.

Relationships are built and maintained through consistent communication.  Building a solid communication system, especially as you grow your Vendor base, is essential to creating strong relationships within your Supply Chain.  We recommend weekly emails to active Vendors and monthly emails to inactive ones.  The emails provide a systematic way to make sure that your system matches up with your Vendor’s system (orders/deliveries/etc.) and can prompt Vendors to respond with their latest update.

Without a consistent system of prompting updates from your Vendors, it’s easy to get lulled into the assumption that everything’s on track when that might not be the case.  People are reluctant to share bad news that could be upsetting, so your Vendors may resist initiating communications with negative content.  You know that the sooner you get bad news, the more quickly you can begin working on solutions, so prompting regular communications makes it far more likely to get negative information sooner.

Getting weekly responses with updates from your Vendors has an emotional benefit that might seem unexpected.  Even if the update isn’t great news, you’ll feel better knowing the truth and being able to deal with potential challenges as soon as possible.

 

3. Build a Pro-Active System to Work the First Article Process with your Vendor.

The first delivery on a new project or from a new Vendor is a significant event.  Ensuring that the product or service being delivered meets expectations often starts with a First Article submission.  Getting initial samples goes a long way to preventing major mistakes or oversights and will ensure that conditions are correct for the balance of production.

Vendors are caught between two realities:

  1. Waiting for a First Article to be approved interrupts their production and the longer they have to wait, the bigger the interruption.
  2. Proceeding into production on a component that isn’t approved could result in producing parts that aren’t going to be acceptable to the Customer.

 

Building a system that effectively works the First Article process with your Vendor will go a long way to helping them provide detailed schedules for those first components and will let them know that you want to help their success in the project.  Responding promptly with inspection data and feedback will help move the project quickly into production, but it requires a commitment from your Team to deal with the First Article Submission in a timely fashion.

Your forcing the planning process to include the details around the First Article submission becomes another opportunity to build the partnership with your Vendor.  You’ll gain confidence in their plan to deliver as you get information leading up to their delivery, and they’ll appreciate your consideration of getting them into production as quickly as possible.

Final Thoughts

Businesses are systems and in Manufacturing, building solid systems to interact with your Vendors allows your Supply Chain to serve you well.  Having a consistent way to start new projects and initiate new Vendors with thoughtful conversation can save considerable time, resources, and money.  Systematically communicating with your Vendors weekly, asking for updates, and providing any additional information as appropriate will continue to grow the relationship into a partnership.  A solid and detailed plan for the First Article submission process will let your Vendors know that your intent is to give them the best opportunity for successful production as soon as the initial samples are approved.

Treating your Vendors as important partners in your company’s success will make them feel valued and they will rise to the occasion.  If they don’t, you’ve given them every opportunity for success, and you can turn to another Vendor that can be a better fit.  Life is too short to spend it worried and wondering if your Vendors will come through for you.  Take a proactive approach and you’ll develop partners in your Vendors.  They’ll be partners that have a strong desire to help you on your path to success.

Thanks for joining us for our Managing Your Supply Chain Series and here’s to your Manufacturing success!

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