Suppier Development at Deree & Company.docx

Was overlooked deere would be better served to modify

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was overlooked, Deere would be better served to modify this plan so as not jeopardize the future of their relationship. Hence, Deree should make sure they maintain a good relationship with Excelsior since their union has proven so favorable in the past. What are the implications of this tactic and the possible consequences, positive or negative? It may have negative impact and strained relationship between two company’s and in long run
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CASE STUDY-1: SUPPLIER DEVELOPMENT AT DEREE & COMPANY. 3 may impact the interest of business by both parties. If Excelsior agrees to Deree’s proposal, considering Deree’s projections are accurate, Excelsior would see a massive reduction in cycle time, and cut costs by approximately 10 percent. As a result, Deree can save money and time by not looking into a new supplier by strengthening the bond with Excelsior. Furthermore, Deere would not only receive their materials in a shorter amount of time, but would anticipate receiving half of the cost saving benefits their supplier sees. On the contrary, if Excelsior refuses to accept Deere’s demands, in its full entirety, Deere would be forced to set in motion the cost and labor intensive process of locating a new supplier. This effort would also incur significant cost and risk on the part of HR. If it is not an appropriate tactic, what are some alternatives? Management of Deree can support to Excelsior for existing process map so that with some low-cost automation, and with some innovation, cost could be reduced. Hence, Deree can consider offering to offset a portion of the $5million they are expecting Excelsior to invest. In addition, the assistance offered by the company to the supplier could be a great way to reduce the risk of Excelsior. Instead, Excelsior will be more cooperative and can be fruitful for both the
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