Supplier Partnership Practices In India

Indian Manufacturing Industries are gearing up to meet growth challenges generated after a global economic slowdow. In most of the organizations, various functions, like purchasing, warehousing, production, transportation etc. are seen as integrated processes. The chain activities of these processes are of immense importance to the overall Supply Chain Management (SCM) startegy. Literature on SCM strategy favours demand driven supply of goods in an environment of “high trust and open relations”. This demands cooperation and mutual committment between suppliers and customers. With highly reliable suppliers the organisations will be able to not only bypass the slow and costly efforts to build one's own capabilities but also access new opportunites. SCM, Lean Six Sigma approach suggest to build long term supplier partnership. However, from literature we find that in India, the trend has been on selection and performance evaluation of the suppliers. Hence a need was felt to study the contemporary status of supply chain strategy in Indian organizations through survey.

In this survey based study, an effort has been made to understand the trend in supplier integration in the manufacturing sector. The empirical survey is carried out to measure the Buyer-Supplier performance in terms of materials planning efficiency, degree of collaboration, transactional proceduers, and supply chain practices through various instruments from the literature. The scores on various measure help us understand contemporary performance of IMS in relation to its supply planning and control abilities.

The study helped in knowing the areas of weaknesses in supply chain management practices in India. The study revealed that the companies are partially aware of partnership concepts and its benefits, but reported doubts on successful implementation. The phase-wise Supplier Integration program is completely unknown to the subjects. Moreover companies have not reported any other reference model for long term partnership to follow in India. Thus ‘Supplier Integration’ is not adopted systematically. It also throws light on the potential areas of improvements. In general, it gives the clear idea of the contemporary health of supply management practices in India.