supplier partnership

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TQM Supplier Parte


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


REASONS FOR PARTNERSHIP Quality and timely delivery JIT concept Practice of continuous process improvement Quality assurance systems (ISO 9000, etc.)


PRINCIPLES OF CUSTOMER/SUPPLIER RELATIONS Both the customer and the supplier are fully responsible for the control of the quality Both the customer and the supplier should be independent of each other and respect each other’s independence. The customer is responsible for providing the supplier with clear and sufficient requirements so that the supplier can know exactly what to produce. Both the customer and the supplier should enter a contract with respect to quality, quantity, price, delivery method, and terms of payments. 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 (Cont.) 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 establish a settlement method in the contract. Both the customer and the supplier should continually exchange information, sometimes using multifunctional teams, in order to improve the product or service quality. Both the customer and the supplier should perform business activities such as procurement, production and inventory planning, and etc. When dealing with business transactions, both the customer and the supplier should always have the best interest of the end user in mind.


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. Benefits: Improved quality Increased efficiency Lower cost Increased opportunity for innovation Continuous improvement of products or services


PARTNERING (Cont.) Key elements for partnering relationship: Long-Term Commitment Trust Shared Vision


SOURCING A sole source of supply implies that the organization is forced to use only one supplier. Multiple sourcing is the use of two or more suppliers for an item. Single sourcing is a planned decision by the organization to select one supplier for an item when several sources are available. Benefits for organization: reduced business and production costs, complete accountability, supplier loyalty, and better end product with less variability. Benefits for supplier: new business from the customer and reduced the cost of business and production processes.


SUPPLIER SELECTION The supplier understands and appreciates the management philosophy of the organization. The supplier has a stable management system. The supplier maintains high technical standards and has the capability of dealing with feature technological innovations. The suppliers can provide those raw materials and parts required by the purchaser and those supplied meet quality specifications. The supplier has the capability to produce the amount of production needed.


SUPPLIER SELECTION (Cont.) 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. The supplier has an effective quality system and improvement program such as ISO / QS 9000. The supplier has a track record of customer satisfaction and organization credibility.

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Partner’s In Quality Supplier Rating Summary

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PIQ Rating Summary

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Supplier On Time Performance


SUPPLIER CERTIFICATION The customer and supplier shall have agreed on specifications The supplier shall have no product-related lot rejection for a significant period of time or significant number of lots. The supplier shall have no nonproduct-related rejections for a stated period of a time or number of lots. The supplier shall have no negative nonproduct - related incidents for a stated period or number of lots. The supplier shall have a fully-documented quality system. The supplier shall have successfully passed an on-site system evaluation. The supplier must conduct inspections and tests. The supplier shall have the ability to provide timely inspection and test data.


SUPPLIER RATING The customers rates suppliers to: Obtain an overall rating of supplier performance Ensure complete communications with suppliers concerning their performance of quality, service, delivery, and etc. Increase the relationship between the customer and supplier


SUPPLIER RATING (Cont.) Three key factors for a successful supplier rating system: An internal structure to implement and confirm the rating program A regular and formal review process A standard measurement system for all suppliers

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