Supplier Development Lifecycle

It takes a Supply Chain to design, engineer, make, deliver, sell, support, service and continuously improve products and services. It only makes sense to have the supply chain be able to closely and digitally work with your organization in an end-to-end fashion.

The presentation below provides our perspective on Supplier Development Lifecycle and the ways you can effectively support and improve supplier performance.



Supplier Development Lifecycle

  • Need for a New Supplier
  • Supplier Evaluation, Selection and Contracts
  • Product/Service Development Collaboration
  • Supplier Development
  • Operational Collaboration
    • Supplier Assessment
    • Supplier Development
  • Ending the Relationship

All Purchasing is Not Equal

There are many ways to categorize purchasing and organize supplier relationships. One such categorization is give below.


  • Right supplier is key to program/company success
  • High Value
  • Complex Specifications
  • Quality and timeliness are essential
  • Cross-functional collaboration needed


  • Not essential for program/company success
  • Specifications are not complex
  • Supplier selection is simpler


  • Low value and standard goods
  • Specified good and agreed price
  • Streamline ordering and payment procedure
  • Use of E-Commerce

Fictitious Example – Apple Supplier Development Strategy


Different Supplier Development Strategies for Different Types of Suppliers


  1. Analysis of Product / Company Strategy and Supply Chain Need
  2. Supplier Research
  3. Supplier Evaluation and Selection
  4. Memorandum of Understanding (MoU)
  5. Product/Service Development Collaboration
  6. Supplier Development
  7. Operational Collaboration
    • Supplier Assessment
    • Supplier Development


  1. Supplier Research
  2. Supplier Evaluation and Selection
  3. Contracts
  4. Product/Service Development Collaboration
  5. Operational Collaboration
    • Supplier Assessment
    • Supplier Development


  • Supplier Selection
  • E-Commerce/Procure-to-Pay


When a New Supplier is Usually Needed

The need for new supplier(s) can arise for any number of reasons. The most common reasons are the following

  • New product/service development
  • Expanding into new markets
  • Selecting alternate suppliers
  • Poor performance by current suppliers
  • Ending a contract with existing supplier
  • Outsourcing internal activity


Evaluating and Selecting Suppliers

Evaluating and selecting suppliers requires a multi-faceted analysis and often varies based on the need. The facets include

  • Product Technology
  • Process Technology
  • Cost
  • Quality
  • Service Level
  • Joint R&D Capability
  • Company

Working with Suppliers on a day-to-day basis

Depending on the type of supplier relationship the day-to-day collaboration with suppliers can include one, more or all of the following

  • Order Placement
  • Collaborative Product/Service Development
  • Collaborative Forecasting
  • Purchase / Manufacturing Order Collaboration
  • Supplier Quality Engineering
  • Supplier Assessment  / Supplier Development


Supplier Performance Assessment

Supplier Performance Assessment is a multi-faceted analysis that can incorporate different aspects of the relationship and importance.


Supplier Development

Supplier Development is a business strategy that is the basis for an integrated supply chain. Many leading companies support Supplier Development by dedicating significant time, money and resources. Below are some case studies that highlight the extent to which industry leaders go to support Supplier Development.