In three years, David Weekley Homes has helped its best trade partners get better; culled the ranks of underperforming, indolent suppliers; and better aligned its supply channel links with what is, in essence, a detailed report card, says Bill Justus, Weekley's vice president of supply chain services.
“Our people in the field were frustrated, they didn't feel like they were always heard [by suppliers]. Suppliers were frustrated because they weren't being ‘told' what they were doing wrong or right,” Justus explains.
The solution was Weekley's National Trading Partners Survey, an extremely detailed survey about the performance of the company's 150 suppliers in both quality and service. Just about every Weekley employee who touches the supply chain, from billing to the design center, is expected to complete the survey each quarter, ranking suppliers from 1 to 10. If they have a gripe, they must make notes about the specifics. The surveys are tallied, and suppliers are assigned a grade from “A” to “F,” relative to their ranking with other trading partners.
“We work with suppliers with poor scores,” he says. “We don't throw them out. The way you get thrown out is if you have apathy. You have to invest sweat equity [in improving] or you are going to run into trouble.” Over the past three years a few trade partners that consistently failed to measure up and didn't put forth any effort to improve were terminated.
“Ironically, most [low performers] have fired themselves,” Justus says. Faced with the intense documentation of problems Weekley's survey provides, they realized they weren't up to the standards and weren't going to get there any time soon, so they walked.
Not every supplier is a fan of the system. “But I haven't had anybody say to me ‘This is a bad idea. I don't think it works,'” Justus says. “Some say, ‘We just don't have the time to do this.'”
More often than not, Weekley's suppliers welcomed the quarterly assessment because it goes far beyond just assigning a letter grade. The detailed document helps sort out what's working and what isn't.
That's information many suppliers say they never had access to before. Often they would lose a builder client and never know why—or how they could have prevented it. They say Weekley's survey has opened up the lines of communication between all links in the supply chain and identified problem areas they wouldn't have known about before. It is a breath of fresh air in an environment that has become increasingly stifling as many builders pull out their hammers and threaten suppliers for price cuts.