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Designing/Enhancing Effective B2B Relationships…
Charles E. Rumbaugh
87th Annual International Supply Management’s Conference
Institute for Supply Management 2002 San Francisco
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine If You Need to “Look” at Designing/Enhancing Relationships
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 10
We Don’t Have Any Suppliers Or Customers!
Really? You’re Kidding!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 9
We Have Crisis Management “Tools” In-Place!
How did those “tools” work on “9-11?” Customers and/or Suppliers impacted?
Focal Point for Communication!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program!
8. Your Code of Ethics must be part of the solution!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 8
Ethical Issues Are Always Surfaced In A Timely Manner!
Within AND Without the Organization?
Do Suppliers Abide by/with Your Code of Ethics?
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution!
7. Have a CPO!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 7
Do We Have Or Need A Chief Procurement Officer?
Who is the Advocate/Champion for the Supply Chain? Characteristics of a CPO
How is that function delegated below the CPO?
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO!
6. Designed to Mitigate Litigation
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 6
Are You “Always” Threatened By/With Litigation With Suppliers/Customers?
How do you “handle” conflict? Rely upon “boiler-plate” terms and conditions? Tailored “statute-of-limitations” for claims?
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation
5. Tailored to particular commodity and acquisition strategy
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 5
Does The Claim/Dispute “System” Reflect The Commodity Or Acquisition Strategy?
• How does the strategy impact the “mode” of relationship-building communications?• Does the contract or purchase order type “drive” the answer? Commodity purchases verses
“more” sophisticated methods
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation 5. Tailored to particular commodity and acquisition strategy
4. Terms & Conditions must be in tune with relationships!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 4
“Our Suppliers ‘Must’ Perform, Our Terms & Conditions Require It!”
• Wow! Transactional verses Strategic Relationship.
• “Pending resolution of the dispute” the supplier shall continue…
• Risk of small business not performing? Cash-flow impact?
• Any impact upon quality or acceptance criteria/warranty?
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation 5. Tailored to particular commodity and acquisition strategy 4. Terms & Conditions must be in tune with relationships!
3. “Sharing” of Best Practices Improves Quality
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 3
Performance and Quality Are Important Here!
• Rating/Evaluation System/Scorecard in-place?
Buyers and Sellers rated?• Best Practices Forum used?• Improved performance of the “entire” supply chain!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation 5. Tailored to particular commodity and acquisition strategy 4. Terms & Conditions must be in tune with relationships! 3. “Sharing” of Best Practices Improves Quality
2. Ombuds and a multi-step process
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 2
Ombuds Are Used Extensively!
• Do you have ombudspersons? Facilitate/mediate Supplier Concerns Contract Formation verses Performance
• Identified in the RFPs?• Identified on the Organizational Website?• Crisis Management Tool!
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation 5. Tailored to particular commodity and acquisition strategy 4. Terms & Conditions must be in tune with relationships! 3. “Sharing” of Best Practices Improves Quality 2. Ombuds and a multi-step process
1. $$$$$$$$$$$$$$$$$$
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways To Determine Need…
Number 1
Money Is “Job” One…!
• Makes good financial sense to have effective communications and, thus, enhance B2B relationships!
• Goes to bottom-line!
Designing/Enhancing Effective B2B Relationships…
Characteristics Of An Effective System…
• Top 10 Ways “Considered” In Design• Goal is Team-Building except…• Internet and phone: Use/Style, Responsiveness, etc.• Communication and Negotiation Skill Training a Must!• Multi-step Process/System (in some/which cases?) 1. Confer in good faith within set period of time 2. Method/time for escalation to CPO/Senior
Management 3. Expert Advice/Neutral Opinion 4. Ombuds/Mediation/Facilitated Negotiation 5. Binding Commercial arbitration OR Litigation
BATNA--Baseball arbitration
Designing/Enhancing Effective B2B Relationships…
Top Ten Ways (Factors) In Design…
10. Recognize “You” Need Suppliers/Customers! 9. Part of “Crisis Management” Response Program! 8. Your Code of Ethics must be part of the solution! 7. Have a CPO! 6. Designed to Mitigate Litigation 5. Tailored to particular commodity and acquisition strategy 4. Terms & Conditions must be in tune with relationships! 3. “Sharing” of Best Practices Improves Quality 2. Ombuds and a multi-step process 1. $$$$$$$$$$$$$$$$$$
Designing/Enhancing Effective B2B Relationships…
Charles E. Rumbaugh
87th Annual International Supply Management’s Conference
Institute for Supply Management 2002 San Francisco