A case study of successful partnering implementation.

The Eastman Kodak Company is a well-respected leader in the imaging industry. George Fisher, Kodak's CEO, has identified five key operating values for Kodak employees:

1. Respect for the dignity of the individual 2. Uncompromising integrity 3. Trust 4. Credibility 5. Continuous improvement and personal renewal[1]

With such values, it is not surprising that when Kodak wanted to improve several key dimensions of its relationships with suppliers, it chose the partnering approach. Following the basic framework proposed by researchers Ellram and Hendrick,[2] a Kodak team took the partnering concept from idea to implementation on a global scale. The purpose of this article is to provide a detailed case study of how Kodak made global partnering work in the purchasing arena. It is hoped that the Kodak experience will provide a guide and answer some key questions for organizations that are considering similar ventures.

The presentation proceeds as follows. First, general background information is provided on supplier partnerships and key related issues. Theoretical justification for the partnering concept is also discussed. Next, the approach used by Kodak is detailed, including the initial contact with suppliers, the involvement of various parties, and the evaluation and selection process. An exploration of how the relationship was developed, as well as major benefits experienced by both parties, precedes a discussion of key success factors and the organizations' plans for maintaining vitality in the ongoing relationship.

A BACKGROUND SKETCH OF THE PARTNERING CONCEPT

Buyer-supplier partnering represents a collaborative approach in which a buying organization and a small number of its key suppliers work together closely, seeking mutual benefits by sharing the risks and rewards of a cooperative relationship that focuses on continuous improvement.

A recent study of approximately 100 matched pairs of buyer-supplier partners revealed the following key characteristics of successful partnering ventures. First, the intensity of these relationships limits the number that can be managed effectively, usually to about 1 percent or less of the purchaser's supplier base.[3] Most important, buyer-supplier partnering relationships tend to be oriented around specific, relatively important purchased items, and they tend to involve a supplier with whom the purchaser has been doing business for a number of years.