Article 57– How do you rate as a customer?………........Page 1 of 2

I am sure that you, like me, have sat in the reception area of a company that you are visiting and noticed a framed certificate on the wall proclaiming it to be “Supplier of the Year”. The bestower of this award is invariably a well-known organisation that adds to the award’s status. In forty years of sitting in reception areas, I have yet to see a “Customer of the Year” award. Yet despite the axiom that the “customer is always right” we all know that a company’s performance as a supplier is heavily influenced by the actions and behaviour of the customer. The customer from hell is just as much a reality as the supplier from hell.

A number of events have prompted the subject matter of this article.

I have belatedly read “Lean Thinking” by James Womack and Dan Jones, two of the authors of that fascinating book – “The Machine that Changed the World”. “Lean Thinking” with its sub-title “Banish Waste and Create Wealth in your Corporation” looks at the application of “lean production” to all functions of the organisation and to the total supply chain.

The second event is that I attended two presentations given by Dr Richard Wilding, Professor of Supply Chain Risk Management at Cranfield University in the UK. Richard believes that competition between companies will be superseded by competition between supply chains.

Thirdly, the filing by GM for Chapter 11 bankruptcy. My understanding is that GM’s relationships with its suppliers were – are – not in accord with the philosophy of “lean thinking” as promoted by Womak and Jones and as practiced by Toyota , the company that has wrested the crown from GM as the largest car manufacturer in the world.

The absence of “Customer of the Year” awards is due to several factors.

One might well ask whether the old traditional adversarial approach, with its lack of trust, benefits the customer. All the evidence points to the contrary. For example, a study by Dyer and Wujin Chu in 2000 revealed that “untrusting buyers pay more than 6 times the administration cost to source a component”.

Here is a checklist of desirable customer attributes. They have been divided into two groups. The first group represents the basic expectations of any supplier whereas the second would only be applicable if customer and supplier believed it to be to their mutual advantage to work towards a real partnership.

....................continued Page 2

Page No