Process Oriented Supplier Development: Building the Capability for Change

IN BRIEF Many companies have achieved impressive improvements in quality, delivery, and costs using results‐oriented supplier development. With this approach, a team led by purchasing professionals makes technical changes such as simplifying work flows, standardizing work processes, and reducing set‐up times in a supplier's operations. However, after such supplier development efforts, suppliers often return to “business as usual,” failing to make further improvements on their own. This article first describes the benefits and shortcomings of results‐oriented supplier development. Next, building upon successful cases of supplier development and research in change management, this article describes process‐oriented supplier development practices which are more effective in building a supplier's capability for improvement. Finally, this article discusses the commitment of resources necessary for this approach to supplier development.