【正文】 nd focus on the key success factorsPartnerships Expectations16Value Managed RelationshipsStrategy, anization and process must be in place in order to ensure VMR success.?Clarity of and agreement on strategy and goalsStrategy?Appropriate level of involvement in and across anizationsOrganization?Detailed and structured process for identifying and implementing opportunitiesProcessKey Success Factors17Value Managed RelationshipsLong term relationships focused on total value are critical strategic issues that must be clearly articulated.?VMRs pursued only where appropriate?True supplier partnerships–longterm relationships with one or few suppliers–relationships at all anizational levels–extensive twoway information sharing–sharing of all savings–willing to address inherent risks?Focus on total valuechain, not input price–suppliers selected based on longterm total value–opportunities identified and captured across entire supply chainKey Success Factors—Strategy18Value Managed RelationshipsInvolvement and cooperation across the anization is critical to success.?Senior management direct involvement and ongoing interest/support?Crossfunctional involvement in scheduling, logistics, design and development?Implementation driven at grass roots level?Clear process champions?Formalized structure and process to perpetuate partnershipKey Success Factors—Organization19Value Managed RelationshipsA detailed process must be in place to maximize value and ensure ongoing opportunity identification.?Up front identification of opportunities and unique value each partner offers?Documented existence of significant untapped systems cost value?Rigorous and factbased supplier selection?Extensive consensus building?Systems and structures to perpetuate processKey Success Factors—ProcessValue Managed Relationships?Scope of partnership limited–not win/win?Focus on price instead of total value–supplier selection based on price–failure to consider total system as source of savings?Chosen strategy inappropriate for purchase categoryAn inappropriate strategy can prohibit a win/win relationship.Reasons for Partial Success—StrategyValue Managed Relationships?Limited senior management participation?Little crossfunctional involvement?Overcentralized decision making: Not participative/inclusive?Ad hoc structure set up to implement strategyPartial success can be caused by senior or line anizational inadequacies.Reasons for Partial Success—OrganizationValue Managed Relationships?Lack of internal and external consensus building?Lack of relentless pursuit?Supplier selection not rigorous and factbased?Technical opportunities not identified up front?Lack of systems and structures to perpetuate the processAn inplete process can also cause limited success.Reasons for Partial Success—ProcessValue Managed Relationships To achieve successful VMRs, there are several areas of potential obstacles to watch out for.?Benefits are vague and unqualified– no “full potential” economics analysis has been developed for both partiesProcess Challenges?Assumptions are made by suppliers that VMRs are a onetime trickCommunication ChallengesWatchouts?Concerns about sharing expense and product information?Sufficient munication of the benefits of change throughout both anizations?There is a lack of understanding and mitment to changing the way business is done?Benefits of the VMR are split in a lopsided manner?SKU proliferation?No ongoing value realization agenda has been created and/or no VMR champions are empowered to act?Organizational barriers (. multidivisional panies)Watchouts24Value Managed Relationships ?VMR Concept?VMR Key Success Factors?VMR Sources Of Value?Bain VMR Process?Example?Key TakeawaysAgenda25Value Managed Relationships ?Improved quality due to reduced variability?Improved munications?Longer mitments allow for longer run lengths?Purchasing economiesA strong VMR can capture the value inherent in vertical integration while allowing the client to focus both capital and management resources on its primary business.Example Sources of Value:Primary Sources of ValueVolume/ScaleEconomiesValue Engineering and Quality Improvement System CostReduction?Technology and capability sharing to create lowest cost, highest value product?Joint determination of potential for:– material substitution– reduction of material content– standardization of materials?Joint identification of redundant/duplicate processes, .– quality control– order processing– transportation– engineering– management functions– improved inventory control?Cross pany logistics– sharing of transportation and distribution operations (., leveraged backhaul opportunities, shared delivery runs)Estimate Percent of Total Value Created: ?25% ?50% ?25%Sources of Value (1 of 2)26Value Managed RelationshipsValue engineering and systems cost reduction are most difficult to implement and require the most senior involvment.Source of Value MethodologyDifficulty of ImplementationSenior Management Involvement?An open dialogue regarding product design begins to optimize design/cost tradeoffs?Value engineering and quality improvement?Buyer and supplier jointly examine current methods of interaction and begin to eliminate redundancies?Systems cost reduction?Consolidation of suppliers allows the buyer to negotiate for share of incremental profit?Volume/scale economicsSources of Value (2 of 2)27Value Managed RelationshipsDisguised exampleIncrease of times6% Profit ImprovementRelevant Plant Capacity Utilization Incremental Margin ImpactIncreasing a supplier’s utilization