Supplier Development: Current Practices and Outcomes

Abstract

This article presents the results of a survey on supplier development. The research indicates that buying firms engage in a variety of supplier development activities. The outcomes and benefits from supplier development, which are determined from a range of measures, e.g., measures of incoming defects, on-time deliveries, and perceptions of the buyer-supplier relationship, are reported. Respondents were generally positive about the outcomes of their supplier development efforts, but their perceptions could have been more favorable. The research also suggests that supplier development activities vary in terms of the level of buying firm commitment to the supplier development effort.

Recycling procurement strategies with variable yield suppliers

“…Krause et al (2007) underscore supplier development's strategic importance to relationship building because of the "shared knowledge and shared asset investment" it brings. The literature generally supports the belief that supplier development could lead to a competitive advantage to the buying firm (Monczka et al, 1993;Krause, 1997;Vickery et al, 2003;Li et al, 2012). This is achieved through improved quality, which leads to reduced costs and higher customer where the manufacturer mitigates risk while maximizing return using a portfolio investment model.…”

“…We begin by looking at supplier selection criteria. Supplier selection has been shown to have a great potential to improve both the buying firm's and the supplier's performance (Monczka et al, 1993;Krause, 1997;Vickery et al, 2003;Li et al, 2012). As such, this area has been researched extensively and we refer the reader to literature reviews focusing on the selection criteria and decision-making process (Weber et al, 1991;De Boer et al, 2001;Aissaoui et al, 2007;Ho et al, 2010;Agarwal et al, 2011), as well as "green" supplier selection (Govindan et al, 2013).…”

“…Within the procurement literature, communication and inter-organizational learning have been identified as key variables in successful buyersupplier relationships (Monczka et al, 1998;Dyer and Nobeoka, 2002;Carr et al, 2007;Krause et al, 2007). In addition, Krause (1997) specifically names communication as one of the three key "antecedents" for supplier development activities. Tying back to selection criteria, Darr and Kurtzberg (2000) highlighted the importance of partner similarity to the facilitation of knowledge transfer between firms.…”

E-procurement and its impact on supply management – evidence from industrial case studies

“…In recent years, the trend has been away from the traditional armslength or transactional relationship which is focussed on price, towards closer, cooperative interactions with fewer suppliers (Ellram, 1991;Krause, 1997;Cousins, 1999;Burt et al, 2003). Suppliers are increasingly seen as vehicles to add value to the buying organisation and in some cases should be more closely integrated into the supply chain.…”

Benchmarking Supplier Development: An Empirical Case Study of Validating a Framework to Improve Buyer-Supplier Relationship

“…Several strategic sustainable activities are involved in developing the core capabilities of suppliers' that are utilized across industries [1]. Reference [2] argues that different supplier development efforts exist but they fluctuate based on the firm's commitment and dedication towards supplier development. Similarly, the increased interest in supplier development and buyer-supplier re-lationship result in highlighting the importance of strategic collaboration of buyers and suppliers to enhance the operational performance and to build-up stronger and long-term relationships [3].…”