Two years after Ford announced a new supplier strategy designed to improve relations with key suppliers, Ford is still struggling to execute it. That’s according to a report in the Detroit News.
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The report says that while some prominent suppliers are applauding Ford’s approach, others say their relationship with the automaker has got worse since purchasing chief Tony Brown unveiled Ford’s “Aligned Business Strategy” announced in 2005.
The new stategy was aimed at building better relationships with fewer suppliers.
The report says that Today Brown acknowledges the going has not been easy.
He says Ford still needs to do more to improve its own purchasing culture. But he also says he is confident the strategy is working, and that suppliers will applaud it — and Ford — in the end.
“I expect rough waters. And it’s understandable — from the industry perspective, from the supplier perspective, from our perspective given how we’ve managed our business in the past,” Brown told The Detroit News.
“But (it) is the right thing to do. In the end, they and we and our customers will substantially benefit from it.”
Supplier analyst John Henke, president of Planning Perspectives Inc., was at the Dearborn Inn two years ago when Brown outlined Ford’s new strategy for suppliers.
“You could have closed your eyes and thought you were at a Toyota supplier meeting,” he said, referring to the automaker that tops suppliers’ lists of favorite partners.
“But nothing has changed. It’s gotten worse. It’s still not working.”
The problem, he said, is that Brown’s strategy requires a fundamental cultural shift at Ford, one Henke says has yet to take place at the bottom of the purchasing pyramid, where it really affects day-to-day relationships between the automaker and its vendors.
However, Brown also says those changes are beginning to take place and that Ford’s culture is not the only one that needs to change.
“We have a culture that’s come up through a less collaborative point-of-view on both sides,” he said. “We built this historical relationship of not trusting each other We’ve got to change that. It doesn’t work.”
