CIPS L4M6 (Supplier Relationship)
LATEST UPDATED STUDY GUIDE
Rated A.
Planning a partnership involves a number of key steps that should be
linked to a clear timeline with milestones. The following list shows what a
plan for developing a partnership might include and why the partnership
may fail if this plan is not in place
✔✔1. Undertake product/service segmentation and supplier preferencing
to sun sure that the correct suppliers are targeted
2. Develop a cross-organizational team
3. Outline the objectives
4. Develop a business case to present to senior management
5. Undertake stakeholder mapping exercise
6. Undertake the required due diligence, credit checks/audit of supplier
premises
7. Develop any required contracts or non-disclosure agreements to protect
confidential data
8. Undertake joint objective planning with the supplier using the
partnership model
9. Identify resources
10. Develop a communications plan
11. Assess if IT systems integration is needed
12. Planning of operational activities to ensure both partners are working
towards the acheivement of the agreed goals
,The expected level of value-added benefits from the partnership may not
materialize due to a number of reasons, such as
✔✔- The buyer may have selected the wrong supply partner
- Over time, one or both partners may have become complacent
- Over time, the market may have changed
- The relationship is not being actively managed and measured
- Lack of value-added benefits could also be caused by the buyer
expecting unrealistic levels of value-added benefits
Buyers and suppliers enter into partnerships in order to achieve benefits.
Value-added benefits are one aspect of this. If the buyer is not gaining
tangible benefits then
✔✔the resources that are being used to create and maintain the
partnership relationship could be deployed more effectively elsewhere
As noted by Emmett and Crocker, the external environment is made up of
a number of factors, such as
✔✔- External elements (STEEPLE)
- Levels of demand for the supplier
- Supply base of the buyer
- The buyer and supplier
- The partnership itself
Examples of change - External elements (STEEPLE)
✔✔- The economy enters a recesion
- A new technology enters the marketplace
- There is a natural disaster in the country where the supplier is based
- Import and export tariffs change
,- Global pandemic
Examples of change - Levels of demand for the supplier
✔✔- A new buyer enters the marketplace and it is a more profitable
customer for the supplier.
- A key buyer exits the marketplace. This would make the partnership
buyer a more important customer
- Levels of demand from buyers in the market increase or decrease
Examples of change - Supply base of the buyer
✔✔- New suppliers enter the marketplace and they are able to offer the
buyer greater business benefits thatn their current partnership relationship
- A previous supplier leaves the marketplace. This would make the
partnership supplier a more important supplier
- Levels of supplier in the marketplace increase or decrease
Examples of change - the buyer and supplier
✔✔- Strategic intent, eg, exploiting competitors weaknesses or expanding
into global markets
- Strategic match, eg, using JIT or TQM
- The buyer or the supplier gains more power in the marketplace
Examples of change - The partnership relationship itself
✔✔- Performance problems
- Change of key personnel
Handy's four types of organizational culture
✔✔- Power: Controlled by an individual, Agile decisions. Autocratic
, - Role: Well-defined structure, Organization authority. Autocratic or
Paternalistic
- Task: Matrix organization, Cross Functional teams. Paternalistic or
Democratic
- Person: Individual experts, Flat organizational chart. Democratic
Characteristics of a Co-destiny relationship
✔✔- The buyer and supplier organizations will be very closely linked,
making decisions about their futer together
- High level of interdependence between the two parties
- Joint ventures are an example of a co-destiny type of relationship
TUPE
✔✔Transfer of Undertakings (Protection of Employment)
TUPE Legislation
✔✔regulations that protect the rights of the employees where work they
were employed to undertake is transferred to a new business
The stages of the relationship life cycle
✔✔On-boarding
1. Qualification
2. Segmentation and risk management
3. Performance management
4. Development and innovation
Phase-out (if required)
LATEST UPDATED STUDY GUIDE
Rated A.
Planning a partnership involves a number of key steps that should be
linked to a clear timeline with milestones. The following list shows what a
plan for developing a partnership might include and why the partnership
may fail if this plan is not in place
✔✔1. Undertake product/service segmentation and supplier preferencing
to sun sure that the correct suppliers are targeted
2. Develop a cross-organizational team
3. Outline the objectives
4. Develop a business case to present to senior management
5. Undertake stakeholder mapping exercise
6. Undertake the required due diligence, credit checks/audit of supplier
premises
7. Develop any required contracts or non-disclosure agreements to protect
confidential data
8. Undertake joint objective planning with the supplier using the
partnership model
9. Identify resources
10. Develop a communications plan
11. Assess if IT systems integration is needed
12. Planning of operational activities to ensure both partners are working
towards the acheivement of the agreed goals
,The expected level of value-added benefits from the partnership may not
materialize due to a number of reasons, such as
✔✔- The buyer may have selected the wrong supply partner
- Over time, one or both partners may have become complacent
- Over time, the market may have changed
- The relationship is not being actively managed and measured
- Lack of value-added benefits could also be caused by the buyer
expecting unrealistic levels of value-added benefits
Buyers and suppliers enter into partnerships in order to achieve benefits.
Value-added benefits are one aspect of this. If the buyer is not gaining
tangible benefits then
✔✔the resources that are being used to create and maintain the
partnership relationship could be deployed more effectively elsewhere
As noted by Emmett and Crocker, the external environment is made up of
a number of factors, such as
✔✔- External elements (STEEPLE)
- Levels of demand for the supplier
- Supply base of the buyer
- The buyer and supplier
- The partnership itself
Examples of change - External elements (STEEPLE)
✔✔- The economy enters a recesion
- A new technology enters the marketplace
- There is a natural disaster in the country where the supplier is based
- Import and export tariffs change
,- Global pandemic
Examples of change - Levels of demand for the supplier
✔✔- A new buyer enters the marketplace and it is a more profitable
customer for the supplier.
- A key buyer exits the marketplace. This would make the partnership
buyer a more important customer
- Levels of demand from buyers in the market increase or decrease
Examples of change - Supply base of the buyer
✔✔- New suppliers enter the marketplace and they are able to offer the
buyer greater business benefits thatn their current partnership relationship
- A previous supplier leaves the marketplace. This would make the
partnership supplier a more important supplier
- Levels of supplier in the marketplace increase or decrease
Examples of change - the buyer and supplier
✔✔- Strategic intent, eg, exploiting competitors weaknesses or expanding
into global markets
- Strategic match, eg, using JIT or TQM
- The buyer or the supplier gains more power in the marketplace
Examples of change - The partnership relationship itself
✔✔- Performance problems
- Change of key personnel
Handy's four types of organizational culture
✔✔- Power: Controlled by an individual, Agile decisions. Autocratic
, - Role: Well-defined structure, Organization authority. Autocratic or
Paternalistic
- Task: Matrix organization, Cross Functional teams. Paternalistic or
Democratic
- Person: Individual experts, Flat organizational chart. Democratic
Characteristics of a Co-destiny relationship
✔✔- The buyer and supplier organizations will be very closely linked,
making decisions about their futer together
- High level of interdependence between the two parties
- Joint ventures are an example of a co-destiny type of relationship
TUPE
✔✔Transfer of Undertakings (Protection of Employment)
TUPE Legislation
✔✔regulations that protect the rights of the employees where work they
were employed to undertake is transferred to a new business
The stages of the relationship life cycle
✔✔On-boarding
1. Qualification
2. Segmentation and risk management
3. Performance management
4. Development and innovation
Phase-out (if required)
