Controls in Strategic Supplier Relationships by M Briers

By M Briers

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Portfolio analysis methodology was used to identify those products CONTROLS IN STRATEGIC SUPPLIER RELATIONSHIPS 18 and services where an SSR was appropriate. The first SSR created was with the internal transport supplier, because the contracts were approaching renewal and the activity of internal transport impacted throughout the plant. In terms of communicating and displaying the new policy of close relationships with few suppliers, internal transport seemed an obvious choice. As stated above, Firm A had up to 20 transport companies and 30-40 courier companies which delivered to the central storeroom.

These mechanisms operated in a similar manner to those at Firm A, defining `acceptable' bounds of behaviour and identifying penalties for non-compliance. SSR contracts also contain a number of clauses which provide Firm B employees with the authority to require background information on any supplier employees, the right to prohibit the entry of any supplier employees to the Firm B site, and the right of inspection of contractor's sheds, tool boxes and vehicles. Suppliers are also required to strictly abide by the vehicular traffic regulations and enforcement regime in place.

38-55. Meyer J and Rowan R, `Institutional organizations: formal structure as myth and ceremony', American Journal of Sociology, 1977, pp. 340-63. Neu D, `Trust, contracting and the prospectus process', Accounting, Organizations and Society, vol. 16 (3), 1991, pp. 243-56: [1991a]. Neu D, `New stock issues and the institutional production of trust', Accounting, Organizations and Society, vol. 16 (2), 1991, pp. 185-200: [1991b]. Porter ME, Competitive advantage of nations, Macmillan, London, 1990.

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