1. 1 Building Stronger Customer-Supplier Relationships Kimball E. Bullington, Ph.D., P.E. Stanley F. Bullington, Ph.D., P.E.

2. 2 Why Long-Term Relationships? Increasing trend toward global supply Higher baseline performance Increasing focus on time to market Dependence upon suppliers for technology

3. 3 Why Long-Term Relationships? A long-term relationship between purchaser and supplier is necessary for best economy. How can a supplier be innovative and develop economy in his production processes when he can only look forward to short-term business with a purchaser? W. Edwards Deming, Out of the Crisis

4. 4 Why Long-Term Relationships? Trend toward LT contracts since 1990 Pressure to reduce price Pressure to reduce transaction costs Consolidation pressures

5. 5 Challenges for a Useful SCR Model Relationships are critical Trust may be low Literature focuses on causes of failure

6. 6 Challenges for a Useful SCR Model Limited number of published SCR successes Successes could be culture-dependent Model should be simple & proven

7. 7 Family Strengths Research Strong families 20+ years of research Over 6,000 successful families surveyed

8. 8 Family Strengths Research Culturally diverse population Compares favorably with other taxonomies of family success Summarized in six characteristics

9. 9 Family Strengths Research 6 Characteristics of Strong Families Commitment (trust) Good communication patterns Ability to deal with crises Spiritual wellness Spending time together Appreciation

10. 10 Six Characteristics of Successful SCR’s Commitment Good communication patterns Ability to deal with crises (change) Spiritual wellness (principles-centered) Spending time together Appreciation / feedback

11. 11 Commitment: Concerns Is this the right supplier? What about unequal commitments? Is management committed? What are the implementation issues related to maintaining commitment?

12. 12 Commitment: Implementation Selection prior to initiation Two-way criteria for success Regular performance reviews Management committed to proceed Participation requirements identified early Implementation of complete SCR model

13. 13 Matrix for SCR Selection Increasing Spend / Value Potential Increasing Risk / Complexity

14. 14 Communication: Concerns Replace face-to-face communication with technology? Good communication = $$$ Communication between technical groups Role of agent

15. 15 Communication: Implementation Face-to-face communication increased & facilitated by multiple technologies Support for communication forums Triad as core team Agent investments in communication

16. 16 Dealing with Change New product development process Common improvement process Objective performance measures Conflict resolution by team leaders –commitment management –communication assurance

17. 17 Shared Principles Principles Centered Leadership Two-Way Performance Measures Follow-through on Commitments

18. 18 Spending Time Together Quarterly performance reviews Team building dinners Commitment to keep the schedule

19. 19 Appreciation Celebration of critical improvement Recognition distribution Other forms of recognition

20. 20

21. 21 Building Stronger Customer- Supplier Relationships Kimball E. Bullington, Ph.D., P.E. Middle Tennessee State University Stanley F. Bullington, Ph.D., P.E. Mississippi State University