Supplier development

One of the main goals of OSME is to accelerate learning among the participants. An organization purely focused on learning collaboration is CERN, the European Organization for Nuclear Research in Geneva. CERN is the world’s leading high-energy physics laboratory engaging 23 member states with around 2,600 staff members and over 17,000 researchers, from more than 70 countries.

CERN has its own supplier development program. Transferring knowledge from one organization to another is only a small fraction of this program. Furthermore, direct financial benefits are not a significant factor when suppliers are evaluating the main advantage of working with CERN.

What makes the collaboration truly valuable is when the supplier becomes a strategic partner in the project-delivery process. In such collaboration, the principal and the supplier work together, first, to pool then, to minimize their risks through constructive negotiation where both parties openly share their expectations. Any uncertainties concerning milestones and budget-related changes become shared problems. It is in such cases that most of the learning and other non-commercial benefits are created. The principal has the main responsibility for achieving this.

For the principal, not all suppliers can become strategic innovation partners. Therefore, it is necessary to categorize suppliers so that those that can provide strategic value get the needed support. Other suppliers that operate in areas where relevant knowledge is better structured will be handled through a more traditional principal-supplier relationship.

When the principal evaluates suppliers, three types can be identified: i) those that have their strengths in known process technologies, ii) suppliers that are adaptive and interested in product and technology development, and iii) those that are even prepared to deal with technologies that are yet neither proven nor even known. Each type of supplier category is important, but their strengths make them suitable for different forms of collaboration. The principal’s supplier categorization will recognize this.

The suppliers, in turn, have their own way of categorizing customers. Customers that can provide the strongest learning opportunities are a special case, and they may be prioritized even if they are not financially at the top. Learning from working with such customers can be used in other customer relationships and add value to the whole customer portfolio. Evaluating to what extent this will happen is one of the most difficult tasks when developing a customer-focused strategy.

OSME aims to offer principals and suppliers a platform supporting the most demanding innovation collaboration. Hereby, OSME can contribute to added value also in other supplier and customer relationships.

OSME invites new members to expand the ecosystem, creating OSME 2.0. If you are interested in joining OSME, please contact Christian Sundman (christian.sundman(a)wartsila.com) or Niklas Koski (niklas.koski(a)synocus.com).