Supply Chain Management Tools

Abstract

Every supplier strategy must be based on core elements such as classification, categorization, digitization, in-house or external production, digitization and sustainability. As part of the supplier segmentation, the suppliers are grouped into company-wide classes according to preferred suppliers, alternative, benchmark, market and other suppliers. Preferred suppliers are selected suppliers with excellent performance characteristics in terms of innovation, quality, costs, delivery reliability, sustainability and processes. Preferred suppliers are given preferential treatment and are given specified volumes, order volumes and procurement quotas. Preferred suppliers are usually involved in the development and product creation process of their own company at an early stage. The relationship is based on partnership. Alternative suppliers are suppliers who can be used alongside the preferred suppliers. Alternative suppliers are in the group of bidders, but their performance is not as good as the preferred suppliers in terms of quality, costs, delivery and other characteristics, so they usually only receive smaller volumes and procurement quotas. The alternatives are followed by benchmark suppliers who serve as benchmarks and can be included in the group of bidders. Benchmarking in supplier management is a useful method for the systematic and structured acquisition of information and for the comparison of suppliers based on characteristics such as innovative strength, technological leadership, cost efficiency or quality awareness. Benchmarking is thus a constant creative process to improve the supplier portfolio by determining and comparing the best-known services of existing suppliers and the comparison with new suppliers who show particularly strong performance characteristics (English: benchmark = the best; best practice). By adopting and continuously improving the identified best practice processes, the performance of your own area, competitiveness and ultimately customer satisfaction are improved. Seen in this way, a benchmarking project within the scope of a tender offers the possibility of comparison with the best solutions, reveals deficits and weak points, clarifies the need for action and can be used as an ideal tool for the development of new suppliers and constant competition. Benchmarking is not just a comparison of key figures or operations, but is a comprehensive, holistically applicable process analysis for improving performance that can be used for all performance areas and the entire company (Helmold, 2021). The benchmark suppliers are followed by market suppliers and all other suppliers. Market suppliers can be included in the group of benchmark suppliers if their supplier management has been qualified and evaluated. All other suppliers are not taken into account (Helmold & Terry, 2021) (Fig. 12.1).

Quality is not an act. It is a habit.

Aristotle