Strategic Partner Collaboration
From Buy-Sell to Partnerships
As a customer paying hard money for goods and services, who are your most critical, strategic suppliers? As a provider, who are your most critical, strategic customers? We work to connect, align, and integrate business partnerships around mutual goals — then collaborate to achieve them.
Shared Metrics Are Key
Every company has (or should have) metrics to control critical aspects of performance. A best practice in the extended supply chain linking customers with suppliers is bilateral "dual scorecard" metrics with jointly developed goals. Built upon collaboration and trust, the results become win-win.
Case Examples
- A multi-million dollar key account raised a concern regarding a high volume of small parcel shipments arriving at their 35 locations nationwide, negatively impacting inbound receiving productivity and frequently damaged in-transit. A collaboration project was initiated to consolidate orders and shipments to a defined weekly schedule, with palletized deliveries to each location as part of a temperature-controlled truckload “milk run” network. In addition to improved labor productivity and reduced damage, direct annual savings in transportation spend exceeded $300k — which was then split and shared with the customer in the spirit of collaboration and long-term mutual loyalty.
- An activity-based costing (ABC) study revealed that customer service order entry time per line was excessive. A Six-Sigma DMAIC project was initiated, “No-Touch Orders,” with the goal of increasing distributors’ utilization of EDI 850 Purchase Ordering from an average baseline performance level of 68% to 95%. Collaborating with a pilot distributor partner, EDI maps were developed and tested. Training was also provided to both companies’ customer service organizations and joint tracking/control metrics were established. Within a short time, pilot EDI order utilization achieved 98%, creating additional order entry productivity and capacity for both the manufacturer and distributor. As a proven best practice, the solution was then replicated by both companies with other suppliers and distributors.
- A key national account was placed on credit-watch due to slow payment of invoices. Upon investigation, it was learned that corporate policy mandated non-payment of any invoices with unresolved discrepancies such as pricing/billing or over/short/damaged (OSD) shipments. With the customer agreeing to provide input to Voice of Customer (VOC) expectations and Critical Success Factors, two sequential fast-track Six-Sigma DMAIC projects were initiated. The first focused on improving shipping accuracy on the warehouse shop floor, with quick-turnaround inventory cycle count verification of reported shipping discrepancies. The second project addressed the back office complaint resolution process, reducing cycle time by 67% from 45 business days on average to 15 days. In summary, shipment accuracy increased, claims were resolved within the agreed-upon turnaround time — and invoices were paid on time.