Supplier Development Programs: An Empirical Analysis

To compete effectively in the global marketplace, a company must have a network of competent suppliers. A supplier development program is designed to create and maintain such a network—and to improve various supplier capabilities that are necessary for the buying organization to meet its increasing competitive challenges. This article discusses the results of a survey dealing with supplier development activity. The survey was undertaken to determine the current level of involvement in supplier development programs and to assess the success of the current programs. The results indicate that supplier development programs are more prevalent than expected and that large companies are more likely to be involved. The results also show the importance of formal supplier evaluation to the supplier development process.