Supplier development: a process and worked example
Another poor delivery score does not improve a supplier. Follow a joint trial that changes release timing, loading work and the evidence reviewed afterwards.
The supplier receives another delivery score below target. The review ends with the same instruction as last month: improve on-time performance.
Nobody has changed the conditions that produced the late deliveries.
Supplier development means working with a supplier to improve its capabilities or the products and services it delivers. Vendor development is often used for the same idea. CIPS describes joint work on areas such as quality, capacity, cost and delivery.
A supplier scorecard can identify a result worth investigating. Development is the work that follows when both sides agree the capability is worth improving.
Start with the deliveries that missed
Our fictional component supplier delivered 16 of 20 orders in the baseline four-week period on time and in full. The four failures are visible in the order records. An order passes when its full accepted quantity is received within the original agreed window. Both parties keep the promise dates and agreed receiving rules.
| Failed order | What the records show | Work to investigate |
|---|---|---|
| 1 | Buyer changed the released quantity after the production cutoff | Release and amendment rules |
| 2 | Finished parts waited for a shared loading bay | Loading capacity and dispatch sequence |
| 3 | The buyer's late specification release held production | Information readiness |
| 4 | Packing finished after the booked collection | Packing and collection timing |
The delivery result remains 80%. Two buyer-side findings do not erase the missed customer commitments. They do change who can help prevent the next miss.
If the records stop at dispatch, Vrolen's OTIF guide explains why customer-receipt evidence still matters. Its worked numbers belong to a separate example.
For defective material needing immediate containment, use a response such as 8D. A longer development project should not postpone protecting the customer.
Agree one change both sides can test
The teams choose a four-week trial. The buyer commits to a complete release by Tuesday noon. Later amendments require an explicit feasibility check. The supplier reserves Thursday loading slots and checks packing readiness before confirming collection.
These are agreed changes for this relationship, not a universal supplier-development sequence.
| Commitment | Owner | Evidence for review |
|---|---|---|
| Complete release by cutoff | Buyer planner | Release time, specification version and later changes |
| Reserved loading slot | Supplier dispatch lead | Bay allocation and actual loading time |
| Packing ready before collection | Supplier production lead | Completion time and exception record |
| Joint weekly review | Both operational leads | Failed orders, causes, actions and unresolved questions |
The supplier needs 16 hours of setup and training work. The buyer needs eight hours to change its release routine. Those fictional commitments belong beside the proposed benefit. Sending all the work to the supplier would leave half the problem untouched.
Check the result and the conditions behind it
During the next twenty comparable orders, nineteen meet the same delivery rule: 95%. The one failure follows an unplanned equipment fault.
That is an improvement in this example, based on a small sample. Check whether order size, product mix, demand pressure or receiving rules changed. Review the release and loading records too, so the teams can see whether the agreed method was actually used.
A single successful month does not establish a permanent capability. Keep checking under busier conditions and agree who maintains the slot and release rules after the project ends.
Choose where development is worth the effort
CIPS points out that development takes resources and depends on supplier cooperation, opportunity, complexity and risk. A repeated miss alone does not prove a joint project is the best option.
Kraljic's matrix helps frame the commercial importance and supply risk. Then compare development with alternatives such as a changed requirement, a different service arrangement or another qualified source.
The review should end with a feasible commitment from each side, not another request for a better percentage. If the buyer cannot hold its release cutoff or the supplier cannot reserve the bay, resolve that before presenting the trial as agreed.
Source and example notes
- CIPS: Supplier development. Joint capability improvement, selection and resource commitments.
Orders, causes, hours and trial results are fictional. The two groups each contain twenty orders under the same agreed rule. Their comparison illustrates follow-up; it is not a causal study or a promised service gain.