Reduce Fulfillment Time Increase Flexibility Organize for Mass Customization Collaborate with Engineering Collaborate with Suppliers in Fulfillment Outsource for the Right Reasons Improve Quality and Reliability Eliminate Production Losses

• Choose strategic suppliers that help them grow in capacity, quality, technology, flexibility, etc.
• Make buying decisions based on the total cost of ownership
• Inform suppliers as soon as new orders arrive
• Give incentives to companies to locate their plants nearby to reduce delivery times and allow frequent, small daily deliveries
• Train and help suppliers to be compatible with their production systems
• Certify suppliers and eliminate incoming inspection
• Buy complete, tested subassemblies
• Let suppliers choose where to buy components from an approved list
• Take delivery of parts at the last minute
• Have parts arrive ready to go on the line on special returnable containers
• Invite suppliers to keep technicians on-site

• Keep suppliers in the dark regarding growth, technology, product introductions, etc.
• Select suppliers based on the unit part price, and select the lowest bidder every time
• Buy in large lots to reduce transportation costs
• Buy parts according to forecast
• Buy component parts and then build and test in-house
• Tell suppliers where to buy their components
• Receive parts in large containers, breakdown and bring parts to the lines
• Accept cartons and other packing materials increasing production cost

• Lets strategic suppliers plan their capacity, technology, etc.
• Treats the supplier as an extension of your plant, fully utilizing his capabilities
• Lets suppliers start as soon as orders are received
• Keeps parts and subassemblies arriving on-time
• Lets suppliers make suggestions that lead to improvements
• Lowers cost of parts, and provides opportunities to share gains

"Dell increased the work done by its suppliers, who now install the power supply and wire harness on the chassis they ship to Dell. There are fewer parts and less assembly time." - Designers think outside and inside - the box at Dell, Austin American-Statesman, September 21, 2000

"…Roth (Nortel's CEO) launched an electronic marketplace, called e2open, that informs it 72 suppliers the minute the company received an order. That way, suppliers can quickly start making or shipping the components Nortel will need. Just since the July launch, the system has allowed Nortel to ship everything from switches to optical gear in half the time it used to take." - Business Week, September 18, 2000