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General Milling Corporation
The Strategic Value of Strong Supplier Relationships
Lawrence Pepito
Lawrence Pepito, is a Supply Chain Management professional specializing in procurement, strategic sourcing, supplier management and operational improvement. With experience in supply chain and procurement, he brings a practical perspective to building resilient supply networks, managing suppliers, improving processes and creating long-term value. His areas of interest include procurement transformation, risk management, contract management, Lean Six Sigma, and the growing role of AI and technology in supply chain management.
Evaluating and Qualifying the Right Suppliers
In evaluating potential suppliers, we first look at their product portfolio to understand what they can offer and whether their products meet our requirements. We then review their company profile, including its history, customers and projects handled. This gives us a broader view of its supply and implementation capabilities. Lastly, we assess its financial capacity and determine the size of the business we can give the supplier without compromising performance.
Balancing Quality, Cost and Supplier Reliability
Quality should come first when considering a supplier. A good-quality product can contribute to cost savings, while a reliable supplier can consistently provide quality products. To achieve this, organizations need to conduct thorough and objective due diligence.
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Quality should come first when considering a supplier. A good-quality product can contribute to cost savings, while a reliable supplier can consistently provide quality products.
Addressing Challenges in Supplier Qualification
The most common obstacle during supplier qualification is the due diligence process. If its importance is overlooked, organizations can end up with unreliable suppliers that affect overall operations. Procurement teams should therefore be diligent in gathering accurate supplier information to make informed decisions.
Using Technology and Data to Improve Sourcing Decisions
Technology plays a significant role in sourcing by making complex tasks easier to perform. Data, especially historical data, can support sourcing decisions by helping identify the right suppliers, including original equipment manufacturers (OEMs). Standardization also makes processes transferable and helps maintain continuity even when team members retire or move to other roles.
Preparing for the Future of Sourcing and Supplier Relationships
In the future, sourcing will become more challenging as global markets continue to change. Suppliers are increasingly entering open markets, and exclusivity is diminishing. Many suppliers claim they can provide almost anything, which can compromise quality. Product ownership is also becoming less clear as products are supplied by multiple parties, while after-sales service may not always be secured.
