I hope that you have enjoyed the article “Are Big Suppliers A Big Supply Risk?” This article was based on the series of case studies that I just finished posting here on this blog.

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The article gave some guidelines for dealing with big suppliers. Let’s further explore the case studies to see how those guidelines could have applied.

There were case studies involving four big suppliers: Dell, Yahoo Web Hosting, Kelly Services, and Office Depot. The Dell and Yahoo Web Hosting case studies were bad and the Kelly Services and Office Depot case studies were good.

All big suppliers – what was the difference?

A big factor differentiating the good from the bad (and the high supply risk vs. the low supply risk) came down to people. At Kelly Services and Office Depot, we had an internal advocate or Single Point of Contact (SPoC).

These internal advocates (Cari and Kelly and Gerry at Office Depot) didn’t simply throw a challenge over the proverbial wall and let another department worry about fulfilling an obligation to a customer. They took personal responsibility for seeing things through.

Big suppliers tend to have lots of internal controls. When dealing with them, you need an internal advocate that knows how to pass through the internal controls quickly. They need to specifically know who can solve a problem, how it will be solved, when it can be solved, what potential obstacles to a solution there might be, and how to overcome or avoid those obstacles.

With Yahoo and Dell, I just don’t think that anyone with whom the client has contact actually knows these things. There are too many channels to go through to get a simple problem solved (e.g., like having a server rebooted or emailing a coupon code).

For any purchase where there is elevated supply risk and you are doing business with a big supplier, you absolutely need an internal advocate. The case studies demonstrated the difference in supply risk when you don’t have one.

So apply the guidelines from the article and insist on having the SPoC when doing business with a big supplier. You’ll need one when things go wrong – and many times, they will.

To Your Career,
Charles Dominick, SPSM
President and Chief Procurement Officer
Next Level Purchasing, Inc.
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http://www.NextLevelPurchasing.com

Charles Dominick, SPSM, SPSM2, SPSM3

Charles Dominick, SPSM, SPSM2, SPSM3 is an internationally-recognized business expert, legendary procurement thought leader, award-winning entrepreneur, and provocative blogger. Charles founded the Next Level Purchasing Association in 2000, oversaw its incredible growth, and successfully led the organization to its acquisition by the Certitrek Group in 2016. He continues to blog and provide advisory services for the NLPA on a part-time basis as he incubates his upcoming business innovations. Charles is also the co-author of the wildly popular, groundbreaking book, "The Procurement Game Plan: Winning Strategies & Techniques For Supply Management Professionals."

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