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4/18/12

VENDOR SATISFACTION STUDY

Conducted for

Diesel Engines Manufacturer company

By : Ta run Kum a r Bha r t i (102022 )



4/18/12

Industry profileFormal science of market research andstatistical predictability of marketperformance evolved post 2nd world war.

Last 70’s and early 80’s familiarity withanalysts of FMCG

Yet in industrial market analysis remain a little

known.

After globalization necessity of research firmbecome need of the companies.

Today about 1664 marketing researchconsultant and a encies are active.

22



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Company profileBusiness Development Bureau India

Pvt.ltd established in 1989

1992-93 was the time of export awakening inIndia and many enterprises were exploringISO certification. Customer satisfactionmeasurement was an inseparable part of the

exercise, and BDB developed one of the finestanalytical packages for customer satisfactionmeasurement and analysis.

1995-96, BDB was researching the

pharmaceutical and healthcare markets 33



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Conti……..As a result, in 2006-07, BDB developed a

brand new model of offering research andconsultancy expertise in 15 independent

industry segments where BDB’s specificindustry knowledge and research experiencebrought dramatic value to clients

BDB has always been socially sensitive andhas actively or passively participated incauses that impact the Indian quality of life.For example, appalled at the way our animalsare treated BDB decided to spread awarenessabout kindness to animals and set up a Trust44



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Service offeringIdentifying new Business Opportunities

Demand Estimation and Forecasting

Identifying Demand Gaps and Niche Markets

Export Market Identification and ExportPotential Studies

Techno Economic Feasibility studies

Measurement of Customer Expectationand Satisfaction

Analysis of Consumer Behaviour, PricingPacka in as well as Bu in Attitudes55



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4/18/12

Statement of Work Done

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OBJECTIVES OF THE STUDY

To identify the parameters that form the elementsof satisfaction, among the randomly selectedvendors of Diesel engine manufacturing company.

To evaluate the Vendor Satisfaction Level (VSL)

among the selected vendors.

To analyze the VSL for each parameter and torecommend to company suitable strategies basedon the above so as to plan further improvement.

To analyse the qualitative response obtained andpresent them on a structured format.



VSL OUTPUT THAT THIS STUDY SHALL DELIVER

The Study has evaluated the Vendor Satisfaction Index (VSI) based on the following ATTRIBUTES

These attributes are further broken down into several parameters and analysed ona scale of 1 to 10. For each question, two measures are recorded -

Satisfaction Scale And Importance Scale

Not important

101 2 3 4 5 6 7 8 9

SomewhatImportant

VeryImportant

ExtremelyImportant

10

Dissatisfied

1 2 3 4 5 6 7 8 9

QuiteSatisfied

VerySatisfied

Delighted

Satisfaction scale Importance Scale



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ATTRIBUTES AND PARAMETERS COVERED

•Communication of company Vision, Mission and Values•Communication of future projections of 3 years•Clarity in communication through telephone, letter, fax & email•Reach to the Contact person at company•Frequency of interaction with company (operational level)•Frequency of interaction with company (higher level)

COMMUNICATION

RELATED

ATTRIBUTES

•Involvement of supplier at Design & Drawing phase (wherever applicable)•Timely communication of details / requirements of new projects•Timely communication of the engineering changes / modifications•Commercial discussions•company responsiveness to your suggestions•Lead time provided for new product development•Quality System evaluation and process audits conducted by SQI’s•Support and cooperation from Supplier Quality Improvement Team•Overall behavior of sourcing personnel

STRATEGICSOURCING

RELATED

ATTRIBUTES

•Technical support provided during part development

•(Applicable only for ancillary suppliers)•Completeness and clarity in technical specifications•Response or willingness of CRE to accept the suggestions•Overall behavior of Corporate Research Engineering personnel

CORPORATERESEARCH

ENGINEERING

RELATED

ATTRIBUTES



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Continue…

•Completeness and clarity in overall documentation by purchase•Timely receipts of annual requirement in the beginning of the year •Timely receipts of monthly schedule and annual requirement•Timely receipts of correct purchase order or schedules•Response to the Problems by the purchaser •Receipts of GRR copies in time(online access)•Overall behavior of purchase personnel

PURCHASEPROCESS

RELATED

ATTRIBUTES

•Assistance from KOEL in solving the quality issues with supplier •Gauges provided by KOEL•Promptness in providing the details of the rejected items•Single point of contact to discuss the quality issues•Support and cooperation from Receipt Quality Assurance Dept.•Platform available with KOEL for the registration of genuine problems faced by you•Acceptance of modern manufacturing process•Communication of Quality performance on monthly basis•Engineering acceptance norms are well defined and easy to understand•Overall behavior and perception of quality personal

QUALITY ANDINSPECTION

RELATED

ATTRIBUTES

•Reasonable prices from KOEL•Payment as per the agreed norms•Response from KOEL Finance Department•Financial support in case of emergency•Fairness in overall commercial terms•Overall behavior and perception of finance personnel

FINANCIAL

RELATED

ATTRIBUTES



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Continue…

•Overall satisfaction with KOEL.•KOEL’s contribution in developing long term business relationship with Suppliers•Recognition of Supplier performance•Fairness in the business deals

OTHER

ATTRIBUTES

•Operational efficiency•Professionalism•Pro-activeness•Superiority of Quality standards developed•Demanding Customer in terms of Quality, cost and delivery

OVERALL

PERCEPTION

ABOUT

KOEL



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5 6 7 8 9 10

VENDOR SATISFACTION INDEX OF COMPANY

1

2

3

4

5

6

7

8

9

10VSI 8.09

Dissatisfied

Quite

Satisfied

VerySatisfied

Truly Satisfied

Other attributes like company’s contribution in developing long term business relationship with suppliers, recognition of supplier performance, fairness in the business deals and Financial related attributes are the drivers for achieving theoverall satisfaction score of 8.09by company.

Many vendors expressed their dissatisfaction on their involvement of supplier at Concept, Design & Drawing phase,Timely receipts of annual requirement in the beginning of the year and Communication of future projections of next 3years are the main attributes which to focus.



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1.21

0.15

COMMUNICATION RELATED ATTRIBUTES

Priorities for improvement

Parameters withleast gap

5 6 7 8 9 10

Sati

sfac

tion

gap



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Positive features

Vendors are happy with frequency of interaction with operational levelexecutives. Senior executives are alsoaccessible time to time, if required

Vendors also received thecommunication from company abouttheir Vision, Mission and Values

Areas of improvement

Vendors perceive that, company shouldcommunicate the future projections fornext 3 years.

This shall provide business assuranceas well as time to develop theresources to meet the demand.

KEY FINDINGS ON COMMUNICATION



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1.53

0.50

STRATEGIC SOURCING RELATED ATTRIBUTES



Sati

sfac

tion

gap

5 6 7 8 9 10



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Positive features

Quality evaluation system andprocess audits has helpedvendors to improve themselves

Support and cooperation fromsupplier to improve the quality

aspects makes them delighted

Vendors perceived thattreatment received fromcompany sourcing executives isone of the best practice


Vendors feel that their involvement atConcept,Design & Drawing phase shall bring value tothe entire value chain of the business

Timely communication of details about new

projects and the engineering modificationsshall provide more lead time.

Vendors expect that company should reducethe time for commercial discussion andfinalize the order

KEY FINDINGS ON STRATEGIC SOURCING



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0.93

CORPORATE RESEARCH ENGINEERING RELATEDATTRIBUTES



0.23

Sati

sfac

tion

gap

5 6 7 8 9 10



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Positive features

Ancillary suppliers are gettingdesired technical support indevelopment phase bycompany team.

Treatment to vendors by

company CRE team is one of the highest standards


Vendors feel frequent amendments in thedrawings and respective specifications causesunnecessary confusion.

It may not be feasible to implement all thesuggestion from vendors, however company

should communicate vendors about thefeasibility of their suggestions

If possible reasons should also becommunicated if suggestions are not feasible.

KEY FINDINGS ON CORPORATE RESEARCH ENGINEERING



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1.56

PURCHASE RELATED ATTRIBUTES



0.62

Sati

sfac

tion

gap

5 6 7 8 9 10



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Positive features

Vendors have communicatedthat there has been asignificant improvement inthe prompt receipt of GRRcopies. This gives clearcommunication about theirmaterial status.

Documents processed bypurchase department arecomplete and clear.

Vendors feel that there is agood support from buyer.


Communication about the annual planning is oneof the key requirement of vendors and theyexpect company to follow it.

Vendors expect quarterly schedules shall beprovided to them. It help vendors to hedgeagainst the fluctuating material prices.

Vendors feel that they should get next monthschedule in the third week of the month.

Due to the changes in the schedules the leadtime to effect supplies is shortened. Henceeffective long term planning like quarterlyschedules will help vendors to plan supplies in a

effective way.

KEY FINDINGS ON PURCHASE



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0.35

QUALITY AND INSPECTION RELATED ATTRIBUTES

1.21



Sati

sfac

tion

gap

5 6 7 8 9 10



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KEY FINDINGS ON QUALITY AND INSPECTION

Positive features

Company has acceptedmodern manufacturingprocesses and also insistsvendors to adopt it.


Vendors have noticed the improvement inproviding the Monthly PPM report is generatedand communicated to respective vendors. Theyhave also noticed a significant improvement inprompt communication about the rejection.However they expect further improvement inthese aspects.

Vendors feel that they will be very comfortablewith single point of contact to discuss the qualityissues.



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1.49

FINANCIAL RELATED ATTRIBUTES



0.80

Sati

sfac

tion

gap

5 6 7 8 9 10



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Positive features

Vendors have experienced a significantimprovement in on time payment.


Few vendors still complain thatcompany does not offer them goodprices.

KEY FINDINGS ON FINANCIAL



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OTHER ATTRIBUTES

0.72



Sati

sfac

tion

gap

5 6 7 8 9 10

1.17

1.17



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Positive features

Due to long relations with most executives in company, vendors feel that an excellentunderstanding has developed between the vendor and company executives.company executives are easily accessible and available.

Vendors also recognize the company’s contribution (in monetary and non-monetary form) intheir business.

Vendors perceive company as the best organization in terms of ethics and values (human aswell as business). Vendors find this as one of the reasons for their continued association withcompany despite low volumes and competitive prices.

KEY FINDINGS ON OTHER ATTRIBUTES



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1.25

OVERALL PERCEPTION ABOUT COMPANY

0.85



Sati

sfac

tion

gap

5 6 7 8 9 10



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1

2

3

4

5

KEY FINDINGS

SATISFACTION

DRIVERS

Payment as per the agreednorms

Receipts of GRR copies intime (online access)

Company’s contribution indeveloping long term businessrelationship with Suppliers

Response from companyFinance Department

Timely receipts of correct purchase order or schedules

AREAS OF

IMPROVEMENTAT COMPANY

Reasonable prices fromcompany

Involvement of supplier atConcept ,Design &Drawing phase

Communication of future projections of 3 years

Timely receipts of annualrequirement in the

beginning of the year

Commercial discussion

STRENGTH OF

COMPANY

Fairness in the businessdeals

Payment as per the agreednorms

Overall behavior of purchase personnel

Overall behavior and perception of finance personnel

Response from companyFinance Department



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Supplier response on their top 3 customers by contribution

1st

2nd

3r d

supplier rated our company as their top most favorable customer

supplier rated Cummins and Tata Motorsas their 2nd favorable customer

supplier ratedM&M and JohnDeere as their 3rd

favorablecustomer



4/18/12

Thank you

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