Stallkamp reminds us of the buying basics

By Douglas A. Smock -- Purchasing, 3/8/2001

Are you hammering your suppliers for 5% across-the-board price reductions right now? If you are you may be guilty of industrial feudal thinking that plunged chunks of American industry into non-competitive near-insolvency in the 1980s. It happened to Chrysler, and the guy who pulled the company out of its tailspin and turned it into one of the most profitable automotive producers in the world was a purchasing guy who went on to become president of the company.

That guy is Thomas T. Stallkamp. We went back to Tom recently and tapped his brain because guess what? Chrysler's in trouble again, and guess what? They're banging on their suppliers again.

What purchasing people should be doing now-and some are doing-is getting closer to their suppliers in a strategic way, he told us.

Stallkamp's solution at Chrysler was SCORE for Supplier Cost Reduction Effort. "We wanted to pass on as much ownership as possible in every project all the way down to the lower tiers of the supply chain," says Stallkamp. "We showed a willingness to let our suppliers be the real experts. At the same time, we also encouraged them to share their best practices with us."

In Stallkamp's view, modern supply teams are responsible for all purchased products from extraction of materials from the earth to delivery of products to production machinery. In Stallkamp's world, even the plant lift truck drivers report to the supply chain pros. But his vision is even much bigger than that. He sees the supply team and the OEM itself as just a link in a chain that extends from the most distant subsupplier to the ultimate retail customer. He'll be happy when all the players from A to Z work seamlessly together in a massive collaborative effort. It's a big idea, but Stallkamp started applying his ideas as a beginning buyer at Ford and rose all the way to president of Chrysler. We're proud that Tom is a member of our Editorial Advisory Board. Turn to page 42 for his thoughts on the future of the supply chain.