Trust in the supply chain

Chris Balteff, supply stream voyager, at Fluid Components, shares his personal view on why building close supplier relationships are just as important as measuring metrics, and why these relationships need to be build on a foundation of mutual success, not an expectation of failure.

By Chris Balteff, Fluid Components International LLC

Where has the love gone? In today’s ever technological changing world the one thing that remains constant, it’s us. Our goals and expectations in the supply chain are centered on three common results: on-time delivery, competitive pricing and quality. What if we equated “on-time delivery” to faith, “competitive pricing” to confidence, and “quality” to reliance? Where the quest for success is mutual, the outcome exceeds expectations, and the journey is a collaboration with trust at the center of this relationship.

In the last several years trust has been replaced by math. Relationships have been replaced by metrics. Conversation replaced by email. Asking the supplier replaced by telling the supplier. And good coaching replaced by expectation setting.

If buyers, purchasing agents, and supply chain managers are immersed in the supply stream, then issues such as delivery slips associated with PCBAs at a contract manufacture due to engineering change orders (ECOs), or the historical response time to quotes that demonstrate confidence in the relationship, reveal themselves, and we as professionals make the necessary adjustments. The conceptual adjustments to these issues demonstrate leadership and ownership, compared to the data mined analysis where time is surrendered to statistics rather than results.

Finally, over time the strengths of your supply chain, who best can solve your lead-time issues, who has the better quality and where pricing is consistently beating the competition, is revealed through close supplier relationships.

The current state of affairs imposes the statistical analysis of continuously measuring and applying math with data that accumulates more revealing trends that are evident to the same professionals who are doing their job or just paying attention. The profession’s core values are relationships centered on trust not diminished by the sterile transactions of data exchanges.

In the 1980s (Jim Bragg, Hughes Aircraft Co.) and 1990s (Dyanna Madro, Industrial Computer Source), I witnessed first hand the excellence of great purchasing managers or in the modern day vernacular supply chain managers/directors. The single most important attribute each of them had was that they liked people. And above all else, they communicated exceptionally well. Equal to setting expectations was their command and confidence they had in selecting a buyer with the necessary resources to contribute at the highest level.

As supply-chain management tools have improved, the experience is uninspired. The data acts as a curtain between supply-chain management and their suppliers. The math insulates the relationship, negating the most valued reason for doing business — trust.  A handshake makes the relationship personal. A recent example is the Roger Goodell and DeMaurice Smith negotiation of the National Football League’s Collective Bargaining Agreement. The beginning, middle and conclusion of all agreements reside in respectful relationships and the belief that the destination is the same.

Supply-chain management is not engineering. Supply-chain management is creativity, improvisation, an adventure, a sense of humor, and yes, statistical analysis, but more importantly managing relationships is based on trust.

So purchasing managers, supply-chain directors, believe your people will do their jobs, have conviction their goals are the same as yours for the embedded co-dependence between the customer and the supplier is mutual. Mistakes will happen, but to base all accountability in anticipation of failure will not support the best work. Encourage collaboration and trust in relationships.