So long, Bo

Nobody should be surprised by the news from General Motors that the global purchasing czar, Bo Andersson has abruptly left the company “to pursue other career interests.”

[See Crain’s Detroit Business: http://www.crainsdetroit.com/article/20090612/FREE/906129997/-1 ]

Andersson came from the school of thought where squeezing razor thin supplier margins, bankrupting suppliers and pushing undercapitalized vendors was the order of the day. Clearly that approach cannot be sustained.

Domestic automakers are realizing that the supply chain will be playing an increasing important role in the future. The new era will bring suppliers with healthy margins, viable suppliers, innovation, and value based purchasing.

With R&D dollars scarce, OEM’s need suppliers to bring them innovations and no smart supplier is going to send its best new technology to its worst customer.

It does not surprise me that both Chrysler and GM appear to be making the necessary changes in purchasing to create a better culture for supplier relationships.  We’ll have to see if they can make the changes stick.

(Find a longer version of this article on Mlive.com — with suggestions for the new czar, Bob Socia.)

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2 responses to “So long, Bo

  1. George Cantrell

    Amen…it is about time the auto industry wakes up to supply chain reality. Many other business sectors have seen collaboration among trade partners for the past 10 to 15 years to better manage the supply chain as a total system with interrelated parts stretching from raw material purchases through manufacturing, logistics and merchandising to customer point-of-sale. Where this has occurred, suppliers, producers and consumers have all benefitted from more efficient supply chain operations and the improved flow of information. Hopefully, this will now extend to the domestic automobile companies. If not, this may be good-bye U.S. automakers.

  2. P. S. Sundararaghavan

    Very interesting point. I remember a few years ago, a General Manager was moved from Europe to GM-USA for the explicit purpose of “squeezing” the max from suppliers and it lasted for sometime. May be they have finally learned their lesson.

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