Next Generation Best Practices in Managing Suppliers

Part 1: The Outcome Economy

Abstract

This is Part One of a four-part series of reports on the findings from ChainLink research into the next generation of best practices for managing supplier relationships. This research examined hundreds of companies. Among those, ChainLink interviewed the 30 companies achieving the best sourcing results. This series synthesizes the collective next generation of best practices from those top 30 firms.

Report

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Are you getting the most from your suppliers? The leading firms recognize that their supply base is a treasure trove of creative energy and innovation. One of the most potent ways to unleash this creativity is to give your suppliers more degrees of freedom in meeting your needs. This requires a change in mentality to reject Not Invented Here (NIH) and resist the urge to dictate every detail of the answer; then specifying the outcomes that you want.

Advanced companies have already taken steps to break down their internal silos in the requirements specification and collaborative negotiation by integrating their engineering, manufacturing, service, marketing, and other internal functions into those processes. Leveraging the expertise of suppliers and partners is the next logical step in the evolution of cross-functional teaming. By integrating suppliers into the full life cycle of decision-making processes from the very start, the relationship morphs from one of master-subordinate to creative partners.


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