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Closing the Quality Gap:
Involving Suppliers in the Quality ProcessFORM Magazine, May 1993
BY MINDA MORGAN
If forms for one of Harvey Morgan's clients have the wrong ink color or if a marginal word is in the wrong place, the client doesn't want to hear about mix-ups at the plant. As far as the client is concerned, Morgan got it wrong, and the client may take her business elsewhere.
A distributorship is only as good as the manufacturers it employs, says Morgan, CFC, president of DBF Enterprises Inc., a Cleveland, Ohio, distributorship that has been involved in the quality process for five years. That's why Morgan, a past president of NBFA, rates every manufacturer's performance on each job.
Morgan encloses a copy of his "Job Performance-Zero Defects" form with a check when he pays for each job. The form rates the manufacturer's performance on quotes; acknowledgements; delivery; over/under shipments; shipping papers, packaging and labeling; billing; artwork and negatives; and the finished product.
Morgan uses the scoring system, called the defect history, to track vendors' performance. Those who do not perform well lose his business.
"Customers expect the product to be right; that's a given," says John Osborne, president and CEO of The Forms Management Co. Inc., a Wichita, Kan., distributorship that has been involved in the quality process for four years. "We must meet or exceed our customers' expectations."
Meeting or exceeding customers' expectations includes offering special services, meeting scheduled deliveries, responding promptly to customer requests and being "easy to deal with," say distributors. Doing these things requires the help of manufacturers-by involving them in the quality process.
Involving Suppliers
It hasn't always been easy to get suppliers to meet his quality standards, says Morgan. In fact, it can be the hardest part of implementing a quality program, says Osborne. That's because manufacturers and distributors discuss quality differently. Manufacturers often discuss quality in terms of the product, while distributors discuss quality in terms of service, say forms professionals. "If we have to call the manufacturer several times about an order, we not only can't provide our customer with good service, we waste our time and the manufacturer's time," says Morgan. "We have to eliminate these time-wasters."Morgan's job performance form helps his firm and the manufacturer find and eliminate time-wasters. "We get manufacturers' attention by pointing out that service problems cost them as well as us," says Morgan.
Measuring Performance
On Morgan's form, plants receive either a zero, minus or plus for each item. Vendors receive zeros for meeting specifications, pluses for exceeding expectations and minuses for failing to meet requirements. Morgan tracks the performance of each vendor. New manufacturers build up a defect history quickly, which helps Morgan evaluate the firm.Business Forms Specialty Inc., a Hampton, Va., distributorship, also has a form it uses to track adherence to quality. However, BFS uses the form to record and check specifications internally, then asks manufacturers to use the form to rate the accuracy and clarity of the specs.
As part of the quality process, BFS also has a program for selecting manufacturers called the Preferred Vendor Program. When BFS began the program three years ago, it invited certain manufacturers to participate based on the amount of business BFS placed with them and the products they produced.
Manufacturers must sign an agreement with BFS to participate in the program. The agreement spells out exactly what is expected of the vendor and what the vendor can expect from BFS, such as billing and payment terms. "The program is designed to be a two-way commitment," says Alan Sutton, certified data processor and quality manager for BFS. "It helps us develop a formal relationship to improve the quality process."
About 35 vendors currently participate in the program. During the past three years, BFS has terminated agreements with a few vendors who did not meet its standards and added several more. Vendors like the program because they know exactly what to expect from BFS, says Sutton. Participating vendors also receive a "Preferred Vendor Quality Conformance" sheet that charts (by quarter) the number of orders the firm receives from BFS, conformance to standards, the number of non-conforming orders and details of how each job did not conform.
As part of the vendor program, BFS also hosts a preferred vendor day to discuss changes in standards, to present a vendor of the year award (given to the vendor with the highest conformance) and to give certificates to preferred vendors. This year's quality day, scheduled for May 14, is the third the firm has held.
Sutton says vendors were eager to participate in the program, which has been successful. "Vendors are eager to stabilize their customer base," says Sutton. "The program has been well received."
Narrowing the Field
Not all distributors use forms and special agreements to involve suppliers in the quality process. Osborne deals with vendor compliance very simply: He reviewed his vendors and weeded out those that didn't comply with his specifications. Today his firm does business with only about 10 manufacturers."Customers are not orders to us; they are an integral part of our business," says Osborne, a former member of NBFA's Board of Directors. "We want to work with vendors that treat us the same way." Osborne includes manufacturers in some of his firm's activities, such as its awards program for key sales reps. Several years ago, Osborne held a conference to explain his firm's requirements to vendors.
"All we ask of vendors is to never say 'no'," says Osborne. "We want suppliers who are willing to work with us to get the pricing, delivery and service our end user clients want."
Bridging the Gap
Many manufacturers are working to meet or exceed distributors' expectations. "Quality is what the end user says it is," says Tom Dove, CFC, vice president of marketing for Ward/Kraft, a Fort Scott, Kan.-based manufacturer. "Standards vary by distributor, and the things we have to do vary by distributor."Dove says his firm became involved in quality when Morgan began sending quality reports with every check for every order. "It made us realize how we needed to improve our internal operations," says Dove. "Now we try to look for better ways, not just do what distributors tell us to do."
Although many manufacturers are working to provide distributors' clients with the best products and services, many still focus only on the product. Even manufacturers at NBFA's 1992 Mid-Year Planning Conference expressed their belief that the quality process was a waste of time because they already produced quality products. And when Osborne narrowed his supplier list, he says only about 1 percent of the purged vendors even realized he quit doing business with them.
"Manufacturers who are just thinking about the product are going to have a serious problem," says Sutton.
"Total quality means responsiveness to market needs," says Dove. "It's not an internal issue. If we only concentrate on doing better, we are only half there."
Minda Morgan is assistant editor of FORM magazine.