
A Boeing 747-409LCF Dreamlifter (one of four produced) lifts off at Edinburgh Airport. Boeing uses the Dreamlifter, which is an extensively modified Boeing 747, to transport sections of its 787 Dreamliner, which are being engineered and manufactured at multiple locations worldwide. The supply chain includes companies such as Mitsubishi Heavy Industries and Kawasaki Heavy Industries in Japan, Alenia Aeronautica and Global Aeronautica in Italy, Korea Aerospace Industries in South Korea, Boeing in South Carolina, and many more, for a total of about 50 suppliers. The complex of issues involving multiple suppliers has been so difficult to manage that initial delivery of 787s was more than three years late. I've found no reports of unresponsive suppliers, but one can certainly speculate about the frequency of difficult teleconferences for any project of this size (USD 32 billion) that runs over three years late. For more, see the Reuters Special Report, "A Wing and a Prayer: Outsourcing at Boeing".
Unresponsive suppliers are the bane of project schedules. Most planned organizational efforts must meet some sort of schedule. Efforts called projects usually have detailed schedules, which we take very seriously. But the schedule performance of any such efforts that require contributions from outside parties — generically called suppliers — is dependent on the schedule performance of suppliers. Problems can arise when a supplier fails to meet its commitments and doesn't respond to attempts to resolve the matter.
Three guidelines help to make solid relationships with suppliers:
- Ensure that the relationship rests on a firm foundation of mutual respect
- Maintain clarity and ease of communication
- Be easy to work with and make only reasonable demands
Here are some tactics for preventing the problem of unresponsive suppliers, or dealing with it if it develops. In this Part I we explore the foundation of the relationship.
- Verify that the relationship is in good standing
- Before escalating any issue, consider the possibility that the supplier might be acting reasonably. Has your organization been paying its bills when due? Is any legal action underway? Is the contract still in force?
- Ensure that the contract (if there is one) gives you what you need
- A contract requiring that the vendor provide the level of service you'll actually need is helpful, not because it has any force, but because the supplier's having agreed to it usually means that you will be paying a fair price. If the contract doesn't provide what you need, seek a renegotiation. If that isn't possible, identify schedule risk in your risk plan and state that the risk can only be compensated, not mitigated. This is especially relevant in the case of long-term contracts such as leases of real property.
- Know who in your organization can apply pressure
- If you lack Threats you're unwilling
or unable to execute
are riskysufficient clout yourself, determine which people in your organization can credibly press unresponsive suppliers. Let these people know well in advance that assistance might be required. Keep them informed of the scale and expected value of the damage that can result from the supplier's unresponsiveness. - Do not threaten idly
- Threats you're unwilling or unable to execute are risky. If your supplier decides to test your resolve, and you don't follow through with your threatened action, the result will only damage your credibility.
- Consider alternative suppliers
- If your organization is a tiny portion of your supplier's sales, or if the supplier has other more pressing and lucrative accounts, getting the service you need might be difficult. Switching to an alternative supplier (if possible) might be the best available solution, even allowing for any consequent delays and rework. Run some projections to make a careful decision.
Next time, we'll turn our attention to preventive communication practices. Next issue in this series
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Related articles
More articles on Conflict Management:
The High Cost of Low Trust: II
- Truly paying attention to Trust at work is rare, in part, because we don't fully appreciate what distrust
really costs. Here's Part II of a little catalog of how we cope with distrust, and how we pay for it.
New Ideas: Judging
- When groups work together to solve problems, they eventually evaluate the ideas they generate. They
sometimes reject perfectly good ideas, while accepting some really boneheaded ones. How can we judge
new ideas more effectively?
Unresponsive Suppliers: III
- When suppliers have a customer orientation, we can usually depend on them. But government suppliers
are a special case.
White Water Rafting as a Metaphor for Group Development
- Tuckman's model of small group development, best known as "Forming-Storming-Norming-Performing,"
applies better to development of some groups than to others. We can use a metaphor to explore how the
model applies to Storming in task-oriented work groups.
The Storming Puzzle: Patterns and Antipatterns
- Tuckman's model of small group development, best known as "Forming-Storming-Norming-Performing,"
applies to today's task-oriented work groups, if we understand the six principles that govern transitions
from one stage to another. Here are some examples.
See also Conflict Management for more related articles.
Forthcoming issues of Point Lookout
Coming August 13: Leaving High-Touch Jobs: How
- High-touch jobs require that we work closely with colleagues, teammates, clients, or suppliers. Because choosing to leave such a job affects all these people, and the person departing, we would do well find a path that respects all involved. Here are some suggestions. Available here and by RSS on August 13.
And on August 20: Earned Value and Goodhart's Law
- Earned Value Management, widely used approach to project management, is most useful in contexts in which estimators are familiar with the Tasks, the Technologies, and the Teams. But even then, it is vulnerable to the tactics of those who game the metrics. Available here and by RSS on August 20.
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