How to Effectively Integrate a New Supply Chain Partner

Successful businesses are built on collaboration. Sales often works with Marketing. Production with Procurement. But internal collaboration isn’t where the process should end. Smooth collaboration should also extend beyond your organization.

Original equipment manufacturers (OEMs) can often benefit by becoming a trusted partner, not just another vendor, but with their customers. This can help OEMs drive success on all sides by allowing everyone involved to give their input and feedback. This feedback can then be used to improve the products and services you provide.

This is an area RiverSide Integrated Solutions (RIS) specializes in. As a contract manufacturer, we know firsthand the benefits of making your suppliers part of your integrated supply chain partners. Because partnering extends the reach of an OEM, it helps cut costs, increase revenue and reach new markets.

But, of course, it takes a lot of work to integrate a new supply chain partner. So we’ve collected seven of the best tips here to get you started:

Get alignment on the essential metrics, software for supply chain management, etc. When drawing up those metrics, create based on total value, not just the standard supply chain scorecard criteria of customer service, cost, quality and safety.

This includes collaboration tools. With two organizations, multiple interacting workflows, many departments and time-sensitive objectives, keeping everyone on the same page is critical. Customer web portals and cloud-based collaboration platforms are just two ways to keep everyone in sync.

Communications shouldn’t be limited to online tools like email and web portals. Conference calls, on-site visits and monthly review meetings should all be utilized so that issues are elevated and resolved long before they cause lines to go down or result in missed delivery dates.

The best results are achieved when both enterprises engage in long-term collaboration rather than short-term initiatives. Longer commitments incentivize the investments and justify the efforts put into innovating that in turn generate the biggest gains. Also, long-term collaboration provides more stability for strategic planning.

Ideally, your new supply chain partner should function like an extension of your own team. Direct, real-time data sharing can minimize the risks of miscommunication, communication delays and improve supply chain responsiveness through automatic ordering.

For example, a contract manufacturer who specializes in product refurbishment, repair and other reverse logistics functions would be a great supply chain partner for an OEM striving to reduce scrap rates and minimize material sent to landfills.

Common goals mean shared passion and dedication for achieving them. That’s the “raw material” for a successful collaboration. When looking at potential partners, check out their corporate responsibility or about us sections to see what the company cares about.

Maintaining a good relationship with supply chain partners requires continual time, effort and resources to produce any benefits. Your company’s time and capital are finite. Resources can be spread thin by trying to maintain relationships with too many suppliers. Instead, make vendor consolidation a key goal before embarking on major supply chain collaborations.

What’s one of the easiest ways to consolidate vendors? Work with a full-service contract manufacturer, like RIS! Full-service contract manufacturers are great for one-stop shopping and they also make great supply chain partners.