How to Improve Supply Chain Collaboration

business relationship

Shortages in raw materials and overloaded logistics have created major delays and challenges in manufacturing supply chains. Companies are very dependent on the performance of their procurement and suppliers in many ways. The vulnerabilities are urging many companies to develop more collaborative and resilient supply chain strategies. In this article, we share insights and tips to help you improve supply chain collaboration.

  1. Audit the Current Situation

Things may have changed a lot since you last reviewed the supplier performance and risks. Analyzing each supplier is a crucial starting point. First, you need to make sure you have a good structure and platform for yearly auditing.

2. Locate the source of the biggest risks and challenges

Are some suppliers too risky to continue with? Have they performed below average and caused serious issues? Or maybe there are just dark clouds that indicate that actions need to be taken before things go wrong? By regularly auditing the financial state of your suppliers, you can be more confident that they are able to fulfill the purchase orders reliably.

3. Choose key suppliers for strategic collaboration

Schedule regular meetings and make sure the collaboration is as transparent as it can be. Check that important data is in a safe, transparent, and real-time platform. Also, define performance KPIs to monitor together with the supplier. Close collaboration helps to address arising issues before they cause bigger problems.

4. Create an action plan to improve the collaboration

A digital collaboration platform is a must. Are all key suppliers using real-time collaboration tools, for the most efficient workflows? If information is still lost in emails and waiting in someone’s inbox, it’s time to encourage all partners to jump on board the digital transformation.

Your suppliers should have a clear understanding of:

  • How quickly they should reply to your inquiries
  • How reliable the delivery times are
  • How issues are communicated proactively, to avoid unnecessary delays

If the supplier performance is not meeting your standards, open a dialogue about the issues that should be improved, in order for the collaboration to continue. Honest discussion helps with engaging the supplier and motivating them to keep the standards.

A smooth flow of information is an important factor for operational efficiency, and it makes it possible to co-create something unique faster than it would be possible intra-organizationally.

5. Decide which suppliers should be replaced

It is a hard fact that some B2B relations don’t work as well as they should. If the supplier’s risk factor is too high, and they are not willing to cooperate on development projects, it’s best to start looking for alternatives immediately.

In a manufacturing context, B2B relationships are not faceless. Therefore, interaction is the core of daily work. Purchasers are responsible for establishing and maintaining supplier relationships, while they also need to respond to the needs of multiple parties within their own organization.