Suppliers
Suppliers are vital stakeholders of the organization that shapes the efficiency of its operation. Any organization that needs to promote its success needs to develop a good relationship with its suppliers (Krzyżanowska and Tkaczyk, 2014, pp. 157). Its intentions are to create value to its supplier who will reciprocate by delivering quality materials and products that meet the required standards. The move also involves favoring and supporting its suppliers all the times to help them achieve the company’s social compliance standards.
Pacific Brands has taken measures to ensure continued supplier relationships, especially in China. It's China suppliers represent a high percentage of its total manufactured products. The company sources most of its products from China since the nation has a specialist in this field who have developed an outstanding performance with regards to manufacturing and provisions of materials (Crinò, 2009, pp.42). In fact, the talented workforce and materials availability has helped Pacific Brands to foster timely and quality products.
According to Pacific (2016), the company introduced lean manufacturing technology into its supplier factory operations. The move was geared towards promoting the efficiency of their work as well as improving the quality of its products. The program efficiency target was to increase the number of units produced per worker every day and reduce the working hours for every employee. Additionally, the company is dedicated to partnering with its suppliers to enhance efficiency in all levels of production (Roggio, 2013, n.p).
Moreover, Pacific Brands is also conscious of the ethical conduct of its suppliers. This has impelled the company to come up with supplier and manufacturer code of conduct to shape the behavior of its suppliers (Tafoya, 2013, pp.14). The company has taken measures through the use of the code to ensure that its suppliers adhere to labor and human rights, comply with environmental legal obligations, develop strategies and key performance indicators to help them improve their environmental performance score and avoid any incidents of corruption or fraud at all the times (Modi and Mabert, 2007, pp. 46).
Recommendations of how Pacific Brands can achieve improved shared value creation for their key stakeholders:
Suppliers
Pacific Brands should ever be dedicated to improving the performance its suppliers. So far, the company has come up with strategies that help in creating a shared value for its suppliers. Firstly, the company manages the supplier performance all through the conduction of audits and compliance program whose focus is on the factory working conditions and worker welfare. Through the use of the audits, Pacific Brands is able to identify areas that need improvement thus making the necessary corrections. Also, the company encourages the training agenda and capacity building initiatives to help the supplier improve their standards. It is advisable for the company to always use the results from its audit and engage its supplier into a talk that would help in developing future strategies concerning their operations (Kalwani and Narayandas, 1995).
Pacific Brands also puts much effort to ensure that all its suppliers are stable. All the times the company wants its suppliers to remain financially stable so as to create a long lasting relationship. Pacific Brands believe that the changing suppliers from time to time can be expensive in the long run. This compels the company to select suppliers who are willing to supply it for a long duration as reported by Manning (2015, n.p).
In order for the company to promote value creation among its suppliers, it is increasingly important to have a clear understanding of what the suppliers want from the company. This is possible through requesting the suppliers to always ask for an explanation of any action and provide feedback concerning all the shared transactions. This opens a forum through which the suppliers and the company would discuss the way forward. (Karim, Suh, and Tang, 2016, pp. 60) reveals that a sound understanding and agreement on how to operate and interact between the company and its suppliers may help in promoting the shared value as acknowledged by (Bhattacharyya and Guiffrida, 2015, pp. 54). If possible, knowledge gaps should be filled through training and development initiatives organized by the company.
Reference List
Bhattacharyya, K. and Guiffrida, A., 2015) An optimization framework for improving supplier delivery performance. Applied Mathematical Modelling, 39(13), pp.3771- 3783.
Crinò, R, 2009. Offshoring, multinationals and labour market: A review of the empirical literature - Journal of Economic Surveys, 12(3), pp. 37-58
Kalwani, M. and Narayandas, 1995. Long-Term Manufacturer-Supplier Relationships: Do They Pay off for Supplier Firms?. Journal of Marketing, 59(1), p.1.
Karim, K., Suh, S. and Tang, J., 2016. Do ethical firms create value?. Social Responsibility Journal, 12(1), pp.54-68.
Krzyżanowska, M. and Tkaczyk, J., 2014. Shared Value Creation and Marketing.Management and Business Administration. Central Europe, 22(4), pp.153- 167.
Manning, P., 2015. Pacific Brands continues to unravel - Crikey. [online] Crikey. Available at: https://www.crikey.com.au/2015/02/18/pacific-brands-continues-to-unravel/ [Accessed 19 Jan. 2017].
Modi, S. and Mabert, V., 2007. Supplier development: Improving supplier performance through knowledge transfer. Journal of Operations Management, 25(1), pp.42-64.
Pacific Brands, 2016. Pacific Brands. [online] Pacificbrands.com.au. Available at: https://www.pacificbrands.com.au/ [Accessed 19 Jan. 2017].
Roggio, A., 2013. 7 Tips for Good Supplier Relationships. [online] Available at: http://www.practicalecommerce.com/articles/58396-7-Tips-for-Great-Supplier- Relationships [Accessed 19 Jan. 2017].
Tafoya, D. W., 2013. Acknowledging the Relationship between an Organization, Its Stakeholders, and Brand. Organizations in the Face of Crisis, 9-22.
