Strategic Supplier Partnerships in Supply Chain Management

This report discusses the critical aspects of supplier partnerships within supply chain management (SCM), emphasizing their importance, challenges, and the development of efficient supplier relationships. It highlights the shift towards strategic and collaborative partnerships, long-term relationships, and gain-sharing models in contemporary business. The report identifies common issues such as sourcing reliable suppliers, communication gaps, and maintaining quality and consistency in supply channels. It uses an exploratory research design and inductive approach, relying on secondary data thematically analyzed to reveal the significance of supplier partnerships in ensuring smooth production, timely delivery, and economies of scale. The findings suggest that effective supplier partnerships enhance business performance and quality management, but challenges can be mitigated by improving organizational goodwill, investing in relationship management software, and establishing flexible communication channels. The report concludes with recommendations for fostering effective supplier partnerships in global organizational scenarios.

Running head: SUPPLIER PARTNERSHIP IN SUPPLY CHAIN MANAGEMENT
Supplier Partnership in Supply Chain Management
Name of the Student
Name of the University
Author Note

Acknowledgement
The research has been a learning experience for me and I would like to take this
opportunity to convey my sincere gratitude to my professor who gave me this opportunity. I also
convey my gratitude to my mentors and my fellow mates whose support and guidance helped me
in writing this paper.
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Executive Summary
Supplier Partnership, in the contemporary Logistics and Supply Chain Management
domains, refer to the discipline of planning and strategic management of the interactions and
relations which a business has with its third party suppliers. The paper tries to discuss the
different aspects of Supplier Partnership, a vital component of the SCM frameworks of
businesses, highlighting the importance, challenges and ways of development of efficient
supplier partnerships. The findings of the study suggest that there lie several challenges in this
aspect, which include finding right suppliers and establishing effective long term
communications with the suppliers. These problems can be mitigated to a considerable extent by
improving the goodwill of the organizations which in turn can make the companies appealing to
the right suppliers.
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Table of Contents
Introduction......................................................................................................................................4
Background......................................................................................................................................4
Status in Development of Supplier Partnership...............................................................................5
Issues and Challenges faced in the aspects of building efficient supplier relationships..................6
Research Methods............................................................................................................................7
Research Design..........................................................................................................................7
Research Approach......................................................................................................................7
Data Collection................................................................................................................................7
Data Analysis...............................................................................................................................7
Research Limitation.....................................................................................................................7
Findings and Analysis......................................................................................................................8
Importance of Supplier Partnership.............................................................................................8
Ways to achieve efficient Supplier Partnership...........................................................................8
Effects of Supplier Partnership....................................................................................................9
Conclusion and Recommendations................................................................................................10
References......................................................................................................................................11
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4 SUPPLIER PARTNERSHIP IN SUPPLY CHAIN MANAGEMENT

Introduction
The business organizations in the contemporary period operate in a considerably dynamic
and competitive environment, can be attributed to international phenomena of significance like
Globalization, liberalization of trade and also the technological developments. All these aspects
indicate towards increasing needs for efficiency in operating frameworks of organizations and
the supply chain frameworks of businesses play considerable roles in ensuring the same
(Christopher, 2016). Keeping this into consideration the concerned paper tries to discuss the
different aspects of Supplier Partnership, a vital component of the SCM frameworks of
businesses, highlighting the importance, challenges and ways of development of efficient
supplier partnerships.
Background
Supplier Partnership, in the contemporary Logistics and Supply Chain Management
domains, refer to the discipline of planning and strategic management of the interactions and
relations which a business has with its third party suppliers. An efficient supplier partnership is a
symbiotic relationship which works towards maximization of welfare of both the organizations
as well as their suppliers. The concept of supplier partnership is increasingly coming into
existence in the recent global business environment (Brandenburg et al., 2015). Much of this can
be attributed to the rising needs felt by the businesses to retain their suppliers efficiently in the
backdrop of continuously increasing competition and changing preference patterns of the
customers. The notion has direct linkage with the success of supply chain and total quality
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management frameworks of businesses. However, there still remain considerable debate and
confusions regarding the importance and roles of supplier partnership and also regarding the
differences of the same from the traditional views of supplier management.
Status in Development of Supplier Partnership
With the increasing importance and relevance of establishment of supplier partnerships in
global organizational contexts, different companies across the globe can be seen to be
emphasizing on development of robust supplier partnerships. The key components that can be
seen to be present in common supplier partnership establishments are as follows:
Strategic Partnerships- Most of the companies, in the recent period, can be seen to be
emphasizing on building partnerships with the suppliers in strategic manner, keeping into
consideration the goals of the organization as well as the interests of the potential suppliers. This
can be seen in the case of Canadian hospital industry, where the need for standardization has led
to establishment of strategic partnerships with trusted suppliers (Al-Abdallah, Abdallah &
Hamdan, 2014).
Long term Relationships- Witnessing the benefits of presence of long term and loyal suppliers,
companies like Ford, Toyota and others can be seen to be indulging more in developing long
term partnerships with their car parts suppliers to keep sustaining in the competitive
environment.
Collaborative Partnerships- In many cases the suppliers and the companies can be seen to be
voluntarily agreeing to work together in development of the supply chain such that the products
are efficiently developed and delivered to the customers.
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Gain sharing- The trend of profit sharing with the suppliers, instead of fixed payments for their
products can also be seen to be becoming a trend in the current period, which helps in efficient
usage of resources by both the partners.
All these developments cumulatively indicate towards the increased emphasis of
organizations on development of sustainable supplier partnerships in the current international
business scenarios.
Issues and Challenges faced in the aspects of building efficient supplier relationships
The common problems and challenges which the businesses in the contemporary commercial
scenario, face, in the aspects of supplier management are as follows:
 Sourcing and retaining relevant and good quality suppliers who can be reliable
 Problems of communication gaps between the organizations and their suppliers
 Assurance of quality in both the supplier relations as well as in the materials or services
delivered by the suppliers
 Maintaining consistency in the supply channels
 Maintaining accuracy of product information for clear understanding between businesses
and their suppliers
 Absence of proper visibility in the supply chain
 Improper implementation of technological innovations in development of supply chain
frameworks (Osiro, Lima-Junior & Carpinetti, 2014)
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Keeping this into consideration, it becomes immensely important to analyze the ways in which
supplier partnerships can be established efficiently and also to examine the impacts of the same
on improving the supply chain management, quality management of the operations of businesses
and the overall business performance. The concerned report tries to analyze these aspects taking
the following research methods.
Research Methods
To study the different aspect of supplier partnerships in global supply chain management
and business performance, the following research methods and tools are used:
Research Design
For analyzing different aspects of supplier partnerships and their implications an
exploratory research design is implemented which helps in detailed examination of relevant
information from different sources.
Research Approach
An inductive research approach is adopted for the concerned study, where based on the
information obtained and analyzed, inferences are drawn about the issue of concern.
Data Collection
The study is primarily based on secondary data which are collected from different trusted
and authentic literary resources like research articles, journals, books and credible databases
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Data Analysis
The data collected being mainly qualitative in nature, the same have been thematically
analyzed and the findings are presented in the following section of the report.
Research Limitation
Due to the presence of time constraint the research is focused on secondary data.
However, there remains the lack of collection and analysis of primary data, which could have
contributed in enhancing the comprehensiveness of the concerned study.
Findings and Analysis
Based on the data collected from different sources, the findings are interpreted in this
section under the relevant themes, which are as follows:
Importance of Supplier Partnership
Supplier partnerships, in the contemporary organizational scenario, have the following
significant in the business process as a whole:
a. For maintaining the smooth flow of crucial inputs for ensuring smooth production
process, which in turn helps the organizations to prevent economic losses due to
disruptions in the supply chain
b. For timely delivery of reliable materials which helps the organizations to cater to the
changing needs of the customers more efficiently increasing their satisfaction levels
c. For helping the companies to achieve economies of scale in the long run minimizing
supply chain disturbances (Sillanpää, Shahzad & Sillanpää, 2015)
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Ways to achieve efficient Supplier Partnership
There are several aspects which contribute in the development of effective and symbiotic
supplier partnerships in the supply chain of organizations, the primary ones being as follows:
Investment- The companies need to invest in incorporating supplier relationship management
software in the domain of SCM in order to effectively establish relationships with their suppliers.
Creating goodwill- The suppliers tend to evaluate their customers based on the goodwill and
reputation of the companies, which in turn indicates towards the need to operate ethically and
respectfully to establish long term relationships (Sillanpää, Shahzad & Sillanpää, 2015).
Shared profits- Partnership can be effectively built with the suppliers by sharing profits earned
in place of fixed payments, which in turn will make the suppliers feel to be an integral part of the
process.
Effects of Supplier Partnership
Anatan (2014) asserts that of the several factors which affect the innovations in business
processes and performance positively, effective involvement of suppliers is the primary one:
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Figure 1: Effects of supplier partnership on business performance
(Source: Anatan, 2014)
Gallear, Ghobadian & He (2015), also opine with the help of empirical evidences that
presence of robust supplier partnerships help in total quality management and efficient SCM
operations thereby helping in improving the efficiency and profitability of the concerned
business organizations.
Conclusion and Recommendations
From the above discussion it can be asserted that supplier partnership plays crucial roles
in effective supply chain management and in enhancing business quality, thereby improving the
overall business performance. However, there lie several challenges in this aspect, which include
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