Fire Your Supplier?

A recent article in USA Today suggested that suppliers be fired if they can't meet expectations. I agree with that, after you take one step:

Determine if almost everyone is failing and then look at your own ordering and scheduling processes to see if you're partially to blame.

In any company I've worked, I've suggested that a supplier report card focus on two groups that will make up 20% of all of your suppliers: one that's doing really well meeting expectations and reward them; the other that's not doing so well and figure out what needs to change. Chances are the majority (60-80%) are muddling through, mostly meeting your expectations. I've been involved in too many ordering systems to know that it's usually MRP or unreasonable customer expectations that create a 'crisis' for your supplier. At best, the process will create unreasonable expectations of your own that get passed onto the supplier.

Some suppliers will still excel--maybe because they carry a lot of inventory or have a lot of 'protective' capacity to provide service to their clients. (It's protective in the sense that it protects the company from missing deadlines when glitches or sudden demands occur.) These guys you want to recognize and perhaps reward with more business.

Some suppliers will severely lag behind everyone else because of their own internal issues. These need help or need to be replaced.

Most suppliers have pretty order fulfillment systems and have mostly accommodated your demands. Recognize that you're not their only customer. It's not a supply chain so much as a chain link fence. There's not going to be a lot you can change here. Unless you can change your system to be more robust given the variation in supplier performance, you need to figure out how to live with disappointment occasionally. If you do stock more, or increase your own protective capacity, or some other options to be more effective and efficient, your customers may thank you with more business.