Professional Documents
Culture Documents
Case Highlights: 1. Examples of buyer-supplier power play dynamics 2. Examples from different industries 3. Brief overview of supplier engagement methods by different companies 4. Overview of buyer-supplier mindsets
Case Examples
Toyota
High engagement
High scrutiny
Ambitious suppliers
HK Container Terminals
Private ownership Lack of transparency Cartelization Role of councils and institutional bodies
Squeezing suppliers
Forcing for improvements Online supplier engagement
Hollywood
Short term projects Managed through contacts only High transparency High buyer power initially Low supplier power initally
Microsoft
Monopoly Very high buyer power Engaging suppliers via coercion and
Acer Group
Dual roles Conflict of interests Lost contract from IBM Addressing buyer concerns Spinning off division
designing, production Crucial Co-ordination Contractual Obligations Market mediated outcomes even for long term relationships
Airbus
Duopoly Long term commitment from
suppliers High quality Huge number of contractors Special Importance to Procurement Standards, Policies, Performance review
Insights
Buyer-Supplier relationships dynamics depends upon:
Organizational Culture Type of industry Buyer/Supplier power Information flow in industry Type of commitment required(Long or Short) Engagement methods No. of suppliers
Toyotas Training and Engagement Program seems to be the most successful way of maintaining a healthy relationship.
Recommendations
Higher engagement between buyers and suppliers
To understand each others requirements To orient the supplier
monopolistic market Use of technology to improve the information flow in the Supply Chain It will help in boosting trust Efficient co-ordination and fast decision making Leading to cost reductions Consolidate the no. of suppliers
Lower monitoring and procurement costs
Investing in training and capability building of supplier Buyers and Suppliers should set the industry standards together
It will help in quick resolution of the buyer-supplier disputes/issues