Suppliers - Your Competitive Advantage?

Edward Deeming, originator of the quality movement said that quality companies would treat suppliers as partners. The Body Shop had genuine partnership with its trucking company and even shared its profit with the company which resulted in exceptional performance and a reliable delivery service to their shops – a competitive advantage.

Many companies profess to treat their suppliers, consultants and contractors as partners but in reality, few do. Some organisations demand the most out of their supplier but pay as little as possible. Others insist they are ‘the Customer’ and require suppliers to meet strict demands or go to other providers if they don’t. Others behave in a dismissive way to suppliers and contractors.

Some companies, however, consider their suppliers, contractors and consultants as partners and treat them with respect and fairness. While this seems a logical way to work with suppliers, in my experience, it rarely happens, and yet it can provide a competitive advantage if a company treats its suppliers well.

Here is how to turn your provider relationships into a competitive advantage;
1. Keep to your word, appointments and timelines: Some companies provide little notice on changing their appointments and obligations. Remember, the time of your contractors and consultants is as valuable as your own. Expect suppliers to live up to their promises and also keep your own word and promises.

2. Live your Company values: Most organisations have values that they want all of their staff to work by. These usually include; integrity, respect, teamwork, care for the environment, and so on. Apply these values to your providers just as you would to your own staff. If an organisation was genuine with its values it would treat their suppliers in the same way as they treat their CEO and owners. Treat each supplier fairly when deciding on new work and aim to ensure all potential suppliers are offered the same opportunities as those you currently work with (and possibly favour).

3. Provide relevant, truthful feedback to suppliers: It costs a lot of time, effort and money to put in a proposal and suppliers don’t mind this if they can learn and improve their chances. Often organisations provide little more than a standard letter saying that your proposal was unsuccessful. Be open with your supplier, where possible, providing them with honest feedback. The same applies to a supplier who makes a mistake – help them improve by pointing out where they went wrong.

4. Pay suppliers on time: Some companies pay suppliers’ invoices very late. Suppliers work harder for companies that pay them on time.

5. Give Proper Time for Tenders and Proposal: Give adequate time for suppliers to respond to your requests. Also, ensure the right people are available to answer any questions.

6. Conduct a survey of your suppliers: Ask your providers to rate you on key factors like courtesy, payment, clarity of requests, fairness in selection of contracts, knowledge of their business, integrity, etc. You might be surprised by the results; your suppliers are probably already telling people about how your organisation is to deal with, so you might as well learn firsthand.

Companies may not be ready to replace the saying; “Our Customers Come First” with “Our Suppliers Come First’. ‘Suppliers are Our Partners”, however, might be a useful first step on the road to achieving competitive advantage through outstanding supplier relationships.


Dr Ron Cacioppe is the Managing Director of Integral Development, one of Perth’s most unique and experienced leadership and management consultancies. Ron is also Adjunct Professor at Curtin’s Australian Sustainable Development Institute.

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Flight Correction Skills Vital for Business

Research has shown that 70 per cent of airplane accidents are caused by human error. An even more startling fact is that 50 per cent of these mishaps happen when crews are together for the first time. In 1977, KLM Flight 4805 collided with a Pan Am 747 on a runaway on the island of Tenerife. More than 580 people were killed when KLM’s Captain Jacob Van Zanten, a highly experienced captain with an impeccable safety record, took off without runway clearance because he was running late. The flight box recording showed that his co-pilot warned him that they did not have runway clearance but he did not challenge Van Zanten’s decision because he was hesitant to challenge the captain’s authority. This crash has resulted in many airlines putting in place Crew Resource Management (CRM) training to help staff constructively question decisions and actions made on the flight deck.

While most companies have systems in place to check and recheck actions that could lead to accidents, people often find it hard to question their supervisor or manager’s behaviour, not only in regard to safety but also in business decisions and actions that affect customers, staff and the success of the business. Often people who have lower positions; are younger; women; timid or from minority cultures are less likely to speak up.

We like to be liked and it is very hard to tell our co-workers that they are doing something wrong. It’s even harder to tell our supervisory manager that he or she doesn’t have it right.

Here are some ways to help staff gain the confidence to constructively question decisions:

• For important decisions bring in an external objective facilitator who will encourage open communication between all levels of staff.

• Encourage those who aren’t comfortable challenging leadership by praising them when they put up a good argument. I once worked with a very competent but shy lady who would refrain from challenging others when she didn’t agree with them. Over time she was encouraged and praised for contributing ideas and she gained enough confidence to win arguments, some with the CEO.

• Encourage staff to ask questions when managers give them tasks such as: “Can you clarify that for me?” “When do you need this by?” Do you want me to decide on this without checking back with you and if you want this by tomorrow; are you ok for me to delay the other project you have given me?”

• Have your staff or management meetings conducted by somebody other than you. You can also ask a group to explore an issue without you and come up with a final recommendation to present to you.

• We have modified three steps from the CRM airline training process that can be used by staff to question and challenge another person:

1. State a fact that is causing concern: “The project will not be able to meet the November 15th deadline at this rate.”

2. The second step is to ask a question. Use a person’s name to get their attention: “Jim, do you think it would be useful to check that the other alliance partners can make their commitments on this date?”

3. These two first steps may need to be repeated but if they are not successful then a third step is necessary which states the consequences and suggests tangible solutions, such as: “Jim, I am sure that we are not going to meet the November 15th date and the clients need to know this. If you don’t inform them by next Tuesday, we will incur substantial penalties and more time delays.”

While these are not easy conversations, they can help avoid crashes due to poor management decisions, project problems and many every day problems. As our businesses begin to take off again in the Australian economy, it would be useful to teach yourself and your staff, flight corrections skills.



Dr Ron Cacioppe is the Managing Director of Integral Development, one of Perth’s most unique and experienced leadership and management consultancies. Ron is also Adjunct Professor at Curtin’s Australian Sustainable Development Institute.

strategy | leadership | consulting | surveys | coaching | sustainability
+61 (8) 9242 8122 | |