This article wraps up our series on supply chain quality management. Thanks for sticking with us while we explored the need for measuring supplier performance, how to implement a system to track it, and sample metrics to start the process. Today, we're presenting a success story from our client, Graham Packaging.
Pennsylvania-based Graham Packaging Company manufactures more than 20 billion blow-molded containers annually from 81 plants in 16 countries, generating more than $2 billion in annual sales. The company uses hundreds of vendors in order to support its distributed production facilities and foster competition among vendors. However, in order to maintain high quality standards, Graham Packaging needed a consistent way for the plant managers and the Global Supplier Quality team to collectively drive performance.
The company's Supplier Quality team worked closely with IT to implement an arcplan-powered Supplier Quality Dashboard and Scorecard that saved millions and vastly improved supplier performance.
"We knew we had supplier issues, but we could not quantify them," recalls Tara Holloway, Manager of Global Supplier Quality. “The aggregate view of quality could not be created in Excel so no one could analyze overall performance. We could only see individual plants. Without concrete information about supplier performance, we did not have the leverage we now have to take action with suppliers. As a result, the plants stopped complaining and worked through supplier quality issues, which cost us real dollars in waste, reduced productivity, and poor morale."
Benefits of Graham Packaging’s Intitiative:
- Cost of poor quality has been reduced by up to $250K per year for numerous individual vendors, accounting for millions of dollars in annual savings to the company.
- Fact-based supplier management yields cost reductions in price negotiations, eliminates sub-par suppliers, and improves delivered quality.
- Elimination of spreadsheet use among quality team, plant managers, and executives for data collection and analysis.
- Rapid application deployment and modifications because data access is direct and the development environment is intuitive.
"The value of having one view of the truth can't be overstated. My team now has a standardized, consistent and reliable set of information that we use to communicate internally to executives, with plant managers and also with the suppliers themselves. This has allowed us to identify the true value of doing business with suppliers who do not have poor quality and assists in vendor negotiations."
- Tara Holloway, Manager of Global Supplier Quality
Want to see examples of Supplier Scorecards and Quality Dashboards? Leave us a comment or email us.