Customer, heal thyself. This phrase attributed to Aesop and applied to physicians can also apply to the customer side of the customer-supplier relationship.
To identify hidden cost drivers and waste, customers need to apply lean and operational excellence principles and practices to themselves and to work with key suppliers to adopt these practices as well. Each firm needs to look at not only what it can do to add value to customers and eliminate wastes and cost drivers within its own organizations as well as its internal processes and practices that create waste and cost at its customers and suppliers. Often customers are unaware of the extent that their business processes and practices, while seemingly cost-effective within their own four walls, cause risks, create and multiply waste and cost at the supplier and come back to bite them in the form of higher costs, service failures, quality problems and customer complaints.
When problems occur, some customers are quick to blame suppliers. They may subscribe to the mentality that suppliers have so many problems, it must be their fault. Or believe in the saying that “the customer is always right”. But traditional customer behaviors such as less-than-leadtime orders, inaccurate communication of their requirements to suppliers, and simply knee-jerk blame the supplier responses don’t solve problems. They may even drive away good suppliers. Joint problem solving with suppliers not only builds relationships and trust, but it actually solves problems. Each party needs to take responsibility for their contribution to a problem and to try to fix the problem, not the blame. There are many examples of customers who discovered their own contributions to what they had assumed were supplier issues.
Nothing fancy is needed to jointly address problems. Standard problem-solving tools are effective such as: affinity diagrams to help organize ideas and define a problem; 5 whys to uncover root causes; and Pareto charts to focus improvement efforts by ranking problems and their causes.