Nissan case study free essay sample

Supplier development is considered as a key aspect in the design and development stage of production, its basically a Co-development activity between supplier and customer. â€Å"Co-development processes are an instrument used in several industries to gain a competitive advantage and to reduce development costs† ( Fliess, 2008) Supplier development was defined Krause as â€Å"Any set of activities undertaken by a buying firm to identify measure and improve supplier performance and facilitate the continuous improvement of the overall value of goods and services supplied to the buying company’s business unit† (Krause et al 1998). By analyzing this definition, we can evaluate that customer works with supplier in Within this definition are two distinct types of engagement. The first is externalised, supplier development, where the customer measures performance, and provides incentives for the supplier to improve. The second is internalised. In this case the supplier provides resource and investment to enable them to improve. This increasing dependence on suppliers (Krause et al 1998), and the importance they play in both the maintenance of an existing supply chain and the development of future strategic capabilities suggests a growing requirement on organisations to effectively manage and develop their suppliers. Enhancements can be in product, process, and dimensions of performance such as quality, delivery and cost (Quayle 2000). These development opportunities, through working closely with suppliers for mutual benefit, can be split down into two broad areas. The first being supplier co-ordinationi and the second is supplier development (Hines1994 p6). Supplier development refers to activities carried out by an organisation to help its suppliers improve their own people and processes in order to gain competitive advantage by removing intra-company waste. This may include the provision of actual assistance to suppliers to enable them to improve their processes through 15 joint problem solving and continuous improvement, and hence reduce costs or improve the service metrics. The focus may remain on improving the current performance level, or the collaboration deepens to enhance future supplier performance and enable the supplier to implement strategic changes aligned with their customer strategy and future requirements. References Sciencedirect. com. (2013). Supplier integration—Controlling of co-development processes. available at: http://www. sciencedirect. com/science/article/pii/S0019850105001252 A chronological review of the literature on co-development processes AuthorsFocusNature of studyFindings and conclusions Clark (1989),Clark Fujimoto, 1989 and Clark Fujimoto, 1991, Comparing different practices in Japan, Europe and AmericaEmpiricalAllowing suppliers greater responsibilities represents an important factor in the superior performance of the Japanese car industry in product development. Cusumano and Takeishi (1991) Comparing different practices in Japan and AmericaEmpiricalMost of the suppliers in US auto industry are after the completion of detailed design. Most suppliers have only limited ways to influence the product concept. Those with more mature partnerships and relationships to the customers are given more flexibility. Brockhoff (1992) Transaction costsEmpirical—surveyAnalysis of the impact of technical characteristics of the product under development and impact of contractual arrangements within which the development takes place. Gerlach (1992) Comparing different practices in Japan and AmericaEmpiricalWhen the supplier is strongly embedded to a customer, as well as to other network suppliers, displaying a high degree of interdependence, opportunistic behavior is constrained while conditions for cooperative behavior are improved. Griffin and Hauser (1992) Interfaces within and between the involved companiesEmpiricalUse of OFD leads to more efficient communication within the team and encourages more manufacturer-to-supplier communication. Birou and Fawcett (1994) Comparing different practices in Europe and AmericaEmpirical—surveyAnalysis of different characteristics of co-development with suppliers in both continents in different industrial areas. US companies use supplier involvement more often and earlier in the process than European companies because of market pressure. Dyer and Ouchi (1993) Comparing different practices in Japan, Europe and AmericaEmpiricalPartnerships and alliances with suppliers as they are used by Japanese companies are an increasingly important strategy for firms to develop and maintain competitive advantages. Kamath and Liker (1994) Comparing different practices in Japan, Europe and AmericaEmpiricalJapanese practices are increasingly used in America. It is suggested that few first-tier suppliers, enjoying trust-based long term partnerships with their customers, often participate in early stages of development process. Other suppliers are given specific requirements by the customer. Brown and Eisenhardt (1995) Organization of the development process—building and motivating teamsConceptualIntegrative model of product development consisting of project team, project leader, senior management, suppliers and customer that effect process performance and product effectiveness and financial success. Wilson, Littler, Leverick, and Bruce (1995) Organization of the development processEmpirical—case studiesIdentification of support factors and important risks for the success of co-development relationships to develop practical advice for the implementation of co-development projects. Kirchmann (1996b) Interfaces within and between the involved companiesEmpirical—interviews and surveyIdentification of reasons for customer organizations for co-development, instruments of information exchange and typologies of interfaces between customer and supplier organization. Baldwin and Clark (1997) Supplier involvement as a strategyConceptualPartnerships and alliances with suppliers are an increasingly important strategy to develop and maintain competitive advantages. A prerequisite for this strategy is the modularity of the products. Dyer (1997) Transaction costs and transaction valueEmpiricalDetailed examination of practices of Japanese firms in effective interfirm collaboration. Hartley, Zirger, and Kamath (1997) Identification of factors causing delays in co-development projects. Empirical—surveyWorking with a supplier that has strong technical capabilities reduces supplier-related delays. The benefits of suppliers responsibility for design, and greater buyer–supplier communication was not confirmed. Significant relationships were found between supplier-related delays, the priority of customers top management on the project and the degree of technical change to overall project delays. Kasouf and Celuch (1997) Role of small suppliersEmpirical—surveyFactors are identified that discriminate between firms with high and low relationship orientation. Firms with a high relationship orientation are smaller and more optimistic about the industrys ability to support a greater number of firms in the future, and perceived faster technology change. Ragatz, Handfield, and Scannell (1997) Success factors for integration of suppliersEmpirical—surveyIdentification of success factors for supplier integration based on used management practices and project environment factors. They distinguish relationship structuring differentiators and asset allocation differentiators for the success of a new product. Wasti and Liker (1997) Analysis of supplier involvement in Japanese car industryEmpirical—surveyThrough hypotheses, developed based on the Japanese partnership model (relational contracting), predictions are made on the level of supplier involvement in design based on product characteristics and supplier capabilities. Wingert (1997) Competitive advantage through supplier integrationEmpiricalCompetitive advantages by supplier integration. Strategic and operative configuration of the Value Adding System in the electronic industry. Bozdogan et al. (1998) Timing of supplier involvementEmpirical—case studyBenefits are possible by proactive integration of suppliers from innovations enabled by the suppliers. Each participating member provides those skills and portions of the product for which they are best suited. This requires integrated product teams, long-term commitment to suppliers, co-location, good information flow and flexibility. Holmen and Kristensen (1998) Division of labor between customer and supplierEmpirical—case studyUsing QFD technique the suppliers of a Danish company was divided into those who contribute through task partitioning and those who take part in an interactive product development process. A supplier may benefit from actively entering into the pre-development process. Karlsson et al. (1998) Role of product specificationsEmpirical—survey and case studiesImplications of definition and changes of specifications to cost in a customer–supplier relationship in the auto industry. Several propositions to improve conflicts are made. Wynstra (1998),Wynstra, van Weele, and Axelson (1998),Wynstra, van Weele, and Weggemann (2001) Role of purchasing in supplier involvementEmpirical—case studiesAn integrated framework of specific activities that constitute purchasing involvement in product development, which can help firms to implement, improve and to audit the involvement of purchasing in product development. Handfield, Ragatz, Petersen, and Monczka (1999) Supplier selection and timing of supplier involvementEmpirical—surveyIdentification of supplier selection criteria and timing of supplier integration depending on the kind of product that has to be developed and on technology risks. Hsuan (1999) Division of labor between customer and supplierEmpirical—case studyFour different levels of modularization are distinguished: component, module, sub-system, system. A higher degree of modularization is possible when more collaborative forms of partnership are shared between the partners. McIvor and McHugh (2000) Organization of the development processEmpirical—case studyTo avoid problems during the development process, cultural changes in both companies must accompany successful collaborative relationships. Success requires a change in mind-set understanding, trust, and commitment to the partnership. Ragatz, Handfield, and Petersen (2002) Supplier integration under conditions of technological uncertaintyConceptualConceptual model of the effects of elements of supplier integration process on cost, quality, and time under conditions of technology uncertainty. Mikkola and Skjoett-Larsen (2003) Timing of supplier involvementEmpirical—case studiesThe degree of early supplier involvement and of supplier-interdependence, the extent of asset specific investments, the way of supplier selection and the responsibility given to suppliers vary. Available resources of customer and supplier can be combined in new ways to improve the success of product development. Petersen et al. (2003) Model of supplier integrationEmpirical—case studies/surveyA new product development project requires detailed formal evaluation and selection of potential suppliers prior to consideration for involvement. Only trusted suppliers should be approached to participate. Sharing of information can improve the process. Project outcome objectives should be shared between the partners. Supplier involvement is important when the technology is complex or the buying company does not have enough internal expertise. Koufteros, Vonderembse, and Jayaram (2004) Concurrent engineering and external integrationEmpirical—surveyConcurrent engineering is regarded as the early involvement of an internal cross-functional team in new product development process. This is an important enabler of external integration with a supplier or a customer. McIvor and Humphreys (2004) Timing of supplier involvementEmpirical—survey and case studyIncreased importance of supplier involvement in early stages of product development for OEM products. The analysis is based on information from the electronics industry. Cultural changes in customer and supplier organization are necessary. Perks (2005) Interfaces within and between the involved companiesEmpirical—case studySpecification and synchronization are often critical in co-development projects. Such projects could lead to creative and valuable input if the sharing of information and control of activities is used. Petersen et al. (2005) Organization of the development processEmpirical—surveySupplier selection should not only consider the capabilities of the supplier, but also the culture of the supplier. Involving the supplier in the determination of appropriate technical metrics and targets for the project are key elements in project team effectiveness.