TAILIEUCHUNG - Managing Your Suppliers as a Resource Introduction Several years ago, I visited Camco, GE's

Managing Your Suppliers as a Resource Introduction Several years ago, I visited Camco, GE's appliance manufacturing and distribution business unit in Canada. Camco was the site of one of the earliest, most successful, make-to-order manufacturing systems in the world. Through insight and innovation, Camco's managers developed a manufacturing process that was widely followed. I recall the manager of the manufacturing unit telling me that their suppliers were one of their most valuable resources, but they had not realized it until they engaged them in the new system. To the surprise of Camco's managers, many of their most important suppliers quickly adopted. | Managing Your Suppliers as a Resource Introduction Several years ago I visited Camco GE s appliance manufacturing and distribution business unit in Canada. Camco was the site of one of the earliest most successful make-to-order manufacturing systems in the world. Through insight and innovation Camco s managers developed a manufacturing process that was widely followed. I recall the manager of the manufacturing unit telling me that their suppliers were one of their most valuable resources but they had not realized it until they engaged them in the new system. To the surprise of Camco s managers many of their most important suppliers quickly adopted the make-to-order system in their own businesses significantly compressing cycle time throughout the channel and offered powerful new process innovations that helped Camco in its own business. This discussion came to mind recently when I met with the purchasing group of a major equipment manufacturer. They had identified a number of opportunities to coordinate with their suppliers in mutually beneficial ways. They felt stuck however because they did not have the resources to develop these initiatives to the point where they could engage the suppliers in the many opportunities they identified. During the course of the meeting the purchasing group came to realize that they were not using their suppliers as a resource. Instead they were tacitly assuming that they would have to create projects to develop ways to instruct the suppliers on how to coordinate with them. By the end of the meeting a more powerful alternative became clear. Rather than developing their own intercompany processes for their suppliers they could manage the suppliers and use them as a resource. This involved focusing their efforts on defining clearly what their needs were and what flexibility they had in their own internal processes. Then they could invite their best suppliers to engage with them having the suppliers suggest innovative ways to develop .

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