Supply Chain Reliability: helping your suppliers succeed

I found this article from Freep.com rather interesting on the state of the auto-makers supplier base and how they’ve found ways to increase supply chain reliability and decrease costs by helping troubled suppliers succeed:

Honda Motor Co. spent as much as 35% less on distressed suppliers in 2007 compared with 2006, said Larry Jutte, senior vice president of Honda of America Manufacturing Inc.

Jutte credits Honda’s ongoing aim to help suppliers become more efficient.

Last year, Honda helped some suppliers cut the time needed for production by 38%, Jutte said, “simply by doing the process better.”

For top Japanese automakers, this is what they’ve been doing all along. Honda and Toyota Motor Corp. have long been known for studying the financial details of their suppliers in order to identify — and stop — trouble before it spreads.

But this year may show whether Detroit automakers have learned important lessons from the recent spate of high-profile Chapter 11 cases among auto-parts makers.

Read the whole thing. While the article focuses on the auto-industry, there’s a lesson in there for everyone’s supply chain.