November 9, 2007
Nardelli is listening to his supply base! Is Mulally at Ford?
Analysis of:
Chrysler Plans to Reassign Purchasing Executive | online.WSJ.com
This analysis is solely the work of the author. It has not been edited or endorsed by GLG.
Implications: In the short time Robert Nardelli has been at Chrysler, he has sent very powerful signals to the dealership body, the employees, and now to the supply base as well. He may not be an auto guy but he moves quickly and listens. The hiring of Jim Press from Toyota was a shot heard round the world for the dealership body and employees. Now,Chrysler's Purchasing which has treated its suppliers like the enemy for years is getting shook up.
Analysis: The supply base has during the most difficult of times been asked to quote, requote then told they had work coming only to see it never materialize. In fact, hiring of people and spending of money to get ready for the new business happened as they were told the timing was tight and to get going. In the end it was frequently pressuring the existing supplier to drop prices by having a second one getting ready. so, it is not surprising that cheers are being heard around the supplier community at this change coming.
Ford Motor has the same problem and despite an announcement 2 years ago by the Ford Purchasing VP Tony Brown that strategic suppliers were going to be named on 20 commodities, the list is only partially complete. The vast majority of the supply base says little or nothing has changed especially the attitude. Maybe the two new players in town can learn from each other. It's time for a change in strategy. The supply base is not the enemy.
Analysis: The supply base has during the most difficult of times been asked to quote, requote then told they had work coming only to see it never materialize. In fact, hiring of people and spending of money to get ready for the new business happened as they were told the timing was tight and to get going. In the end it was frequently pressuring the existing supplier to drop prices by having a second one getting ready. so, it is not surprising that cheers are being heard around the supplier community at this change coming.
Ford Motor has the same problem and despite an announcement 2 years ago by the Ford Purchasing VP Tony Brown that strategic suppliers were going to be named on 20 commodities, the list is only partially complete. The vast majority of the supply base says little or nothing has changed especially the attitude. Maybe the two new players in town can learn from each other. It's time for a change in strategy. The supply base is not the enemy.
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