Page 8 - CIMA MCS Workbook August 2018 - Day 2 Suggested Solution

CIMA NOVEMBER 2018 – OPERATIONAL CASE STUDY

The main driver of considering supplier strategy is to reduce costs. It is not because of problems
with late deliveries, quality issues or any kind of disagreement with current suppliers. I
recommend that we discuss our concerns with our current suppliers to see if they can improve
our terms to an acceptable level. If not, then we should consider additional suppliers, but it may
be that the problems can be controlled through an improved service level agreement without
losing the benefits of the close relationship.

TQM and supplier relationships

The benefits to be gained from introducing TQM based principles would include the staff,
customers and suppliers becoming more aware of the ethos and goals of the organisation. The
holistic nature of such a programme will show staff that quality is affected by everyone in the
organisation not just the quality of the service being delivered. Members like to have good
service when things are going well but that good service is even more important when there is a
problem. Suppliers like to be clear what is expected of them in terms of the contract of supply.

Under TQM we would strive to get it right first time, every time. On-going training would mean
that we can have a flexible and knowledgeable staff who get involved in different tasks rather
than repeating the same one every day. This drive towards continuous improvement gives us
more motivated and committed staff which can only lead to an improvement in supplier relations.
TQM would give us a competitive edge in our dealings with suppliers and customers alike.
Members are more and more aware that a gym that meets their fitness training needs has to be
accompanied by top quality service.

As a TQM organisation we will strive to have long term company survival by getting committed
members and building long term supplier relationships. Suppliers will see that working with the
company is a long term mission built on trust and mutual respect and benefits.

Being recognised as a TQM organisation whose ethos is built on delivering quality to members is
exactly what many suppliers are looking for. We are an outlet for their products and if we get it
wrong with their product their image suffers as well as ours. On the other hand if we push the
mantra of getting it right first time, every time, suppliers will want to work with us.

Suppliers would recognise that dealing with a TQM organisation involves a number of obligations
on their part such as consistency of quality in products, consistency of delivery and general
reliability. The supplier also needs to show an ability to be flexible when required.

64 KAPLAN PUBLISHING