Supplier-Customer Relationship Management

These study notes are in use of many institute of supply chain management for their courses outline for supply chain management degree, diploma in supply chain management and supply chain management courses now I am posting this on internet lets start.

Since purchased components account for over 55% of the cost of goods and suppliers are responsible for over 50% of a firm's product quality problems, the relationship between the supplier and buyer is critical. Quality is the most important factor for companies in their relationship between suppliers and customers (Sila et al., 2006). Therefore, supplier and customer relationship management processes can enhance or inhibit competition. Critical processes to this relationship include communication, mutual assistance on new product development, and training. Strong relationships develop win-win relationships, trust, openness and honesty. However, this is easier said than done. As recently as the turn of the century at Whirlpool, little integration between supply chain members existed as different levels of the supply chain had different quality standards and goals (Roethlein et al., 2000). In fact, raw material providers did not understand where their products would finally end up, let alone the quality goals of members further down the chain.

(These notes are personally my theses which I wrote for my supply chain management degree program which I completed from Pacific institute of supply chain management and now I am posting these notes or theses for my students who are mostly from diploma in supply chain management and supply chain management courses certification)

Supplier certification programs incorporate quality and delivery factors into the vendor selection process, which improves quality and delivery while reducing costs. Similarly, when applied to supply chain processes, a certification process assists with supplier selection and supply base optimization, a process to find the optimal number and mix of suppliers. At Alcoa, a world leader in aluminum and related products production, a comprehensive supplier certification program jointly improves quality and reduces costs for Alcoa and their suppliers (Monczka et al., 2009). As a follow-up to supplier selection, supplier performance rating systems assist with developing a stronger linkage between supplier and buyer through developing a win-win relationship for both partners, and assist with standardizing and homogenizing quality goals throughout the supply chain. Process improvements also assist with communication improvements to communicate quality requirements with suppliers, and using performance measurement systems, supplier improvement programs can be developed.

Improvements to the supplier-customer relationship management exist in the eight key principles of Total Quality Management. To begin, communication of quality requirements from the buyer in term of final customers is critical. Supplier certification processes assist with pursuing quality at the source, while statistical quality controls can monitor and control product and process issues. Objective (measured) instead of subjective (opinion based) facts should be shared between supply chain members. A system to monitor and correct defects throughout the supply chain, without pointing blame is imperative.

Image Courtesy: AIMS Institute of supply chain management

Performance data should guide quality and supply chain improvements. With respect to sourcing, supply managers can use data to develop preferred supplier lists, provide feedback to current suppliers, and monitor and improve relationships, products and processes. Total Quality Management programs between suppliers and buyers should focus on prevention of defects, and product and process variance reduction through programs such as supplier certification programs. Monitoring should shift from product monitoring to process monitoring for consistency and reducing variation. A working supplier evaluation and selection system, benchmarking, reduction of duplicated processes, and knowledge transfer between functional units and across member boundaries can assist with the shift to process evaluation. ISO9000, the Malcolm Aldridge National Quality Award, and similar awards are critical factors to consider in the selection system. Another critical aspect in this relationship is developing a viable measure and understanding by supply chain members for process capability. Supplier evaluation and supply base rationalization processes can assist with improving supply chain quality throughout the system as variation between suppliers is reduced and product quality can be improved. As previously discussed, value analysis and value engineering can assist in developing a culture of continuous improvement throughout the supply chain. Similarly including - and rewarding, suppliers for participation in improvement programs can enhance the relationship and reap benefits for both members. The supplier-buyer relationship between supply chain members requires that quality start at the top

Time Factor in Project Management

The time factor manifests itself in a project in the form of deadlines for tasks and the amount of time that these tasks may take. Managing time involves ensuring that tasks are completed on time.

This article was published by my teacher at project management institute during my pmp certification classes.

Time in project plans:

•  Determine which activities should take place in which phase.
• Estimate how long each activity will take
• Determine the order in which activities should be completed.
• Allocate people and materials.
• Allocate activities over time.
• Determine the (most important) deadlines.

Time in progress monitoring:

• Monitor progress.
• Monitor deadlines.
• Adjust schedules.

Time in project reporting:

• Report on the actual timeline.
• Analyze and explain why some tasks proceeded much more quickly or much more slowly than expected.

Time schedules are based on a work-breakdown structure (WBS). A WBS is a decomposition of the tasks that must be completed in order to achieve the project result. Developing a time schedule requires knowing the amounts of time that is needed for each task, who will complete each task and when. One frequently used tool for planning time is the bar chart or Gantt chart (see (1) Material purchasing (2) Material testing (3) Compile testing report (4) Edit report (5) Information days Figure 5 A variety of software packages is available for making and maintaining bar charts (see Appendix 3).

Figure 5: Gantt chart or bar chart, which is commonly used for time planning.

(Image is taken from the course of AIMS Project management institute books for diploma in project management and masters in project management)

A rapidly growing organization was continually taking on more projects. As the company continued to become busier – its products were in great demand – the personnel began to feel pressured to work in a frenzy to complete all of the work that needed to be done. The personnel wanted more people to be hired. Because of the cost, management was hesitant to do so, and they pressured the existing personnel to work harder. How much work could the team actually handle? This question apparently had no good answer, as the organization had no time registration system.

When a new project was started, an estimate was made of the number of hours that was thought necessary, but no one ever checked during or after the project to determine whether this number of hours was actually needed. Project leaders were nonetheless urged to keep their projects under control. The project leaders protested that, without time records, they had no oversight over the projects. After all, because they had no insight into the number of hours that were used to carry out the tasks of a project, and there was absolutely no chance of adjustment.

One project leader decided to register hours with his team. The registration showed that the project ultimately needed four times as many hours as had been originally estimated. After reprimanding the project leader for allowing the project to get so far out of hand, the management decided to introduce a time-registration system.

After several months, a number of bottlenecks became apparent. It was revealed that nearly all of the projects had been budgeted too narrowly. In practice, personnel who had been assigned to work on a project for one hundred hours often proved to need three times as many hours. This transparency was accompanied by new dilemmas. One the one hand, there were indeed too few personnel to carry out the projects well. Additional personnel were needed. The costs of sufficient personnel were considerable. On the other hand, the projects had apparently been sold far too cheaply (for too few hours) to customers. The management was afraid that they would not receive any more orders if they began to charge more hours in their estimates.

(this article is really very useful for pmp certification and diploma in project management exams and masters in project management aptitudes) 

RIBA, ITS PROHIBITION & CLASSIFICATIONS IN HADITHS

Riba an Nasiyah

1.  From Usamah ibn Zayd : The Prophet, , said: "There is no riba except in Nasiyah [waiting]." (Bukhari, Kitab al-Buyu', Bab Bay' al-dinari bi al-dinar nasa'an; also Muslim and Musnad Ahmad) "There is no riba in hand-to-hand [spot] transactions." (Muslim, Kitab al-Musaqat, Bah bay'i al-ta'ami mithlan bi mithlin; also in Nasa'i)
2.  From Ibn Mas'ud : The Prophet, , said: "Even when interest is much, it is bound to end up into paltriness." (Ibn Majah, Kitab al-Tijarat, Bab al-taghlizi fi al-riba; also in Musnad Ahmad)
3. From Anas ibn Malik : The Prophet, , said: "When one of you grants a loan and the borrower offers him a dish, he should not accept it; and if the borrower offers a ride on an animal, he should not ride, unless the two of them have been previously accustomed to exchanging such favours mutually." (Sunan al-Bayhaqi, Kitab al-Buyu', Bab kulli qardin jarra manfa'atan fa huwa riban)
4. From Anas ibn Malik : The Prophet, , said: "If a man extends a loan to someone he should not accept a gift." (Mishkat, on the authority of Bukhara's Tarikh and Ibn Taymiyyah's al-Muntaqa)
5. From Abu Burdah ibn Abi Musa : I came to Madinah and met 'Abdallah ibn Salam who said, "You live in a country where riba is rampant; hence if anyone owes you something and presents you with a load of hay, or a load of barley, or a rope of straw, do not accept it for it is riba." (Mishkat, reported on the authority of Bukhari)
6. Fadalah ibn 'Ubayd said that "The benefit derived from any loan is one of the different aspects of riba." (Sunan al-Bayhaqi) This hadith is mawquf implying that it is not necessarily from the Prophet; it could be an explanation provided by Fadalah himself, a companion of the Prophet, .

These Holy words of Prophet Mohammad P.B.U.H are available in almost every Islamic banking courses syllabus such as diploma in Islamic banking and Islamic finance qualification and certification or other programs offered by institute of Islamic banking and finance.  

Courtesy: AIMS Institute of Islamic Banking and Finance Islamic Banking Courses and Islamic Finance Degree Books

Riba al-FadI

1.       From 'Umar ibn al-Khattab : The last verse to be revealed was on riba and the Prophet, , was taken without explaining it to us; so give up not only riba but also raibah [whatever raises doubts in the mind about its rightful-ness]. (Ibn Majah,)

2.       The Prophet, , said, "Sell gold in exchange of equivalent gold, sell silver in exchange of equivalent silver, sell dates in exchange of equivalent dates, sell wheat in exchange of equivalent wheat, sell salt in exchange of equivalent salt, sell barley in exchange of equivalent barley, but if a person transacts in excess, it will be usury (riba). However, sell gold for silver anyway you please on the condition it is hand-to-hand (spot) and sell barley for date anyway you please on the condition it is hand-to-hand (spot).”

3.       From Abu Sa'id al-Khudri : The Prophet, , said: "Do not sell gold for gold except when it is like for like, and do not increase one over the other; do not sell silver for silver except when it is like for like, and do not increase one over the other; and do not sell what is away [from among these] for what is ready." (Bukhari, Kitab al-Buyu', Bab bay'i al-fiddati bi al-fiddah; also Muslim, Tirmidhi, Nasa'i and Musnad Ahmad)

4.       From 'Ubada ibn al-Samit : The Prophet, , said: "Gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt for salt - like for like, equal for equal, and hand-to-hand; if the commodities differ, then you may sell as you wish, provided that the exchange is hand-to-hand." (Muslim, Kitab al-Musaqat, Bab al-sarfi wa bay'i al-dhahabi bi al-waraqi naqdan; also in Tirmidhi)

5.       From Abu Sa'id al-Khudri : The Prophet, , said: "Gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt for salt - like for like, and hand-to-hand. Whoever pays more or takes more has indulged in riba. The taker and the giver are alike [in guilt]." (Muslim, ibid; and Musnad Ahmad)

I collected all of these hadiths from my thesis of phd in Islamic finance and from my mba Islamic finance lectures in my institute of Islamic banking and finance from I completed my Islamic finance degree and diploma in Islamic banking.