What does a top supplier look like?
By Staff -- Purchasing, 4/9/1998
A new study from kpmg Consulting and the Automotive Consulting Group says best-in-class suppliers have the following characteristics:* Senior management involvement and focus in product development: According to the study, 70% of best-in-class suppliers have top executives who participate in the concept development phase of product development, compared to only 40% in other companies.
* Integrated development tools: Top-performing suppliers use standardized program management software systems to coordinate and track costs across engineering and other functions. In addition, these suppliers typically have software and communications systems that are highly compatible with the systems of their customers.
* High-performance, cross-functional teams: Just as leading OEMs use cross-functional teams to design and develop new products, so do top suppliers. Best-in-class suppliers typically pull together engineering, manufacturing, quality, finance, and purchasing functions to design and develop new products. According to the study, these teams have direct access to senior management so issues can be resolved quickly.
* International leverage: When it comes to overseas business, the study found that best-in-class suppliers pursue higher levels of outsourcing of engineering in products and tooling, particularly in such markets as Europe and Japan. However, top suppliers continue to handle international project management, making them an appealing source for OEMs looking to manufacture overseas.
* Integrated supply-based management: Top suppliers work more closely with OEMs--as well as their own suppliers--during the concept phase of new-product development. These suppliers also act as key integrators and supply managers for the sub-assemblies and assemblies they are designing for their customers.
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