Building Deep Supplier Relationships
Two Japanese automakers have had stunning success building
relationships with North American suppliers - often the same
companies that have had contentious dealing with Detroit's Big
Tree. What are Toyota and Honda doing right?
"The Big Tree [U.S. automakers] set annual cost reduction
targets [for the parts they purchase]. To realize those targets,
anything. [They've unleashed] a reign of terror, and it gets
worse every year. You can't trust anyone [in those companies]."
Director, interior systems supplier to Ford, GM, and Chrysler,
''Honda is a demanding customer, but it is loyal to us. [
American ] automakers have us work on drawing, ask other
suppliers, to bid on them, and give the job to the lowest
bidder. Honda never does that."
CEO, industrial fasteners supplier to Ford,GM, Chrysler, and
Honda, April 2002
"In my opinion, [Ford] seems to send its people to 'hate school'
so that they learn how to hate suppliers. The company is
extremely confrontational. After dealing with Ford, I decided
not to buy its car."
Senior executive, supplier to Ford, October 2002
"Toyota helped us dramatically improve our production system. We
started by making one component, and as we improved, [Toyota]
rewarded us with orders for more components. Toyota is our best
Senior executive, supplier to Ford, GM, Chrysler, and Toyota,
No corporations needs to be convinced that in today's
scale-driven, technology-intensive global economy, partnerships
are the supply chain's lifeblood. Companies, especially in
developed economies, buy more components and services from
suppliers than they used to.
Read more from:
Building Deep Supplier Relationships: Jeffrey K. Liker and
Thomas Y. Choi
Harvard Business Review, December 2004
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