The following article was prepared by Mike Taylor, C.P.M. for distribution to NAPM affiliate newsletters. 


Evaluate Electronic Capability

March 29, 2002

Are we using e-mail and the Internet more in our business? What about our suppliers?

According to many surveys and reports, e-mail and the Internet are commonly used tools of Supply Chain Management. Just like the fax machine, the Internet has become an indispensable part of our process. It's convenient, available 24x7 and worldwide.

Both buyers and sellers use it to: 

Find information about products and services 
Post company policies and procedures 
Advertise requirements or availabilities 
Transmit solicitations, proposals and orders 
Communicate status, changes, questions and answers.

With all these uses and advantages, we should be considering electronic capability when evaluating potential suppliers. We should give a preference to suppliers that can send and receive e-mail. It saves time and acquisition cost. In a competition, which might otherwise be equal, "ease of communication" makes a big difference.

I'd suggest notifying potential suppliers up front with words like these:

" Use of the internet and e-mail to transmit and receive information is an important ("integral" for some of us) part of managing contracts and purchase orders. An evaluation preference will be given to suppliers who demonstrate proficiency in the use of these tools in conducting business."

Then include some specifics, depending on your own needs and business processes.

"Suppliers should demonstrate the ability to: 

Receive and respond to e-mail messages in a timely manner 
Retrieve and open documents posted on the Internet in (MS Word, WordPerfect, PDF, Excel, AutoCAD, and/or ) 
Download, open and respond to documents in the above formats transmitted as e-mail attachments.
Accept electronic orders using on-line order entry.
Transfer large files via FTP protocol (if you don't know what this means, then you aren't doing it) 
Receive, translate and respond to documents sent in XML standard xxx"

Add any other commonly used processes.

Even if we aren't ready to formally include these issues as part of the evaluation process, we should be encouraging suppliers to move in that direction. I would suggest discussing these questions as part of any interview with a supplier. If you are considering an e-commerce agreement, find even more questions to ask a supplier in the E-commerce Checklist at http://www.mltweb.com/ec/eccheck.htm  .

I'd also suggest being very critical of the answers. Is the supplier proficient or just giving us the answer we want to hear? If not, how many hours can we afford to spend teaching, helping and finding workarounds? [Side note for Government contractors; could assisting suppliers in this way be considered "technical leveling"?]

Recent news articles about AOL e-mail prompted my thoughts on this subject. It seems that AOL has authorized it's own employees to use a different e-mail service because of the problems that AOL E-mail has with attached documents and large messages. I read the article in MSNBC.COM attributed to Matthew Rose and Martin Peers of the Wall Street Journal on March 22, 2002.  I found the full text of the article in several places although as a news story it moves into archives faster than I can update the links. These reports confirm my experience that AOL may be great for families, but is lacking as a business tool.

I've spent quite a few hours trying to help suppliers who claimed to have good electronic capabilities but could barely turn the computer on. It's disappointing to find that the new long-term agreement was issued to a supplier who had to go to the public library to download e-mail or couldn't open simple e-mail attachments. I've even had a supplier ask (after the contract award) what kind of computer I recommended they purchase.

This is unacceptable. Just as we expect a supplier who is building precision parts to have the required testing and inspection tools, we should expect suppliers to have appropriate business knowledge and tools.  For most of us today, that means a supplier must be a capable user of business technology as well as technically competent to do the job.  


 

MLTWEB is assembled and maintained by Michael L. Taylor, C.P.M. 
Materials and articles prepared by Mike may be shared for purchasing education provided that this source is cited and no fee is charged. The rights for any other use are withheld.
Copyright;  Michael L. Taylor, C.P.M.
Last Updated: 02/26/2012