By Rich Weissman
I will not go into sordid detail of what constitutes the world’s oldest profession, but I’ll jump directly to the world’s second oldest profession: blaming suppliers.
I am not using the recent tragedy at the clothing factory in Bangladesh to call for the elimination in offshoring. My feelings on this phantom cost-savings menace are well documented. What I am angry about is Wal-Mart’s mea culpa about blaming the supplier who placed orders with the factory that was destroyed by fire, killing more than 100 workers. According to a news report, Wal-Mart did not want this factory used and said that their supplier had placed orders on the factory without their knowledge. There it is…the supplier’s fault.
The problem is I think I believe them. I used to use a domestic electronics contract manufacturer who would outsource significant parts of my orders without my knowledge. I found this out during a surprise visit. “We need to do this to keep costs in line” and “You never said we couldn’t” were two phrases I remember from the argument that ensued.
But I learned even more during a sourcing visit to a machine shop I reviewing. The owner of the shop was proud that he accepted all orders no matter what the capabilities of his shop. He would outsource the work he couldn’t do and actually made a higher margin on that work than what ran through his shop. “I make a good living on buyers who have no clue what they are buying”. I’ll never forget that line from him.
This global supply chain thing of ours is all about strategic sourcing. But it seems that we just might not be making all of the sourcing decisions.
Endicott College Assistant Professor Rich Weissman teaches management courses for the School of Business and the Van Loan Graduate School. He is also the director of corporate education, which includes the Center for Leadership, Endicott’s management development institute. He is vice chair of the planning committee and also serves on the technology committee and the Institution Review Board. A practitioner turned educator, Weissman has more than 25 years of experience in all facets of procurement and supply chain management. He has held positions with large business units of Fortune 500 companies, medium-sized contract manufacturing companies, small venture-backed Internet startup firms, and third-party procurement, consulting and strategic sourcing firms.
Rich holds an M.S. in Management from Lesley University and a B.A. in Economics from Rutgers University. He is past president of the Purchasing Management Association of Boston and a recipient of the Harry J. Graham Memorial Award, the highest honor bestowed by the association.
George E. Krauter
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