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Matrix Management Wiki

6G. Customer-to-Supplier Relationships

  • 6G1. A customer-to-supplier relationship exists whenever there is a handoff of a deliverable from one person in a process to the next person in a process.
    • 6G1i. Customer/supplier relationships are one of the most important relationships in the matrix.
    • 6G1ii. When the deliverable is delivered to someone inside the organization, that person is an internal customer.
    • 6G1iii. When the handoff is to someone outside, that person is an external customer.
      • 6G1iiia. These customers may or may not pay for the products/services they receive. For example, in government agencies and many nonprofits, the goods and services may be delivered without compensation by the customer.
  • 6G2. The goal of a customer-to-supplier relationship is to satisfy the “needs” of the customer plus as many “wants” as resources will permit.
    • 6G2i. Table 6.2. Customer-to-Supplier Needs vs. Wants
The purpose for which the deliverable will be used.Specific features and functions that the customer would like to have included in the deliverable.
The problem the deliverable will solve or the opportunity the customer wants to take advantage of.Not all wants can be accommodated because of limitations of resources or technical obstacles.
The features and functions that directly address the purpose. These are considered “must haves”.  
  • 6G3. Requirements are the specific features and functions that are included in the accountability agreement for the deliverable.
    • 6G3i. Requirements should be defined collaboratively by the customer and the supplier.
    • 6G3ii. Only requirements that have allocated resources can be included in the deliverable agreement.
  • 6G4. Each leader and professional must build relationships with his customers and suppliers.
    • 6G4i. The first step in managing customer relationships is to identify who the customers and suppliers are within each process. This can be done by creating a high-level customer/supplier relationship map.
  • 6G5. The relationship between suppliers and customers, both internal and external, is that of a partnership. It is not an authority-based relationship.
    • 6G5i. Both internal customers and suppliers must work together to determine the best way to satisfy the end customer, whether that end customer is internal (support process) or external (operating process).
    • 6G5ii. Thus, the supplier and customer are dependent on each other, and they will ideally be tied together by team accountability.
    • 6G5iii. Figure 6.5. Diagram of internal customer/supplier relationships.
      detailed flow chart showing customer and supplier relationships
  • 6G6. Customer and supplier rights and responsibilities:
    • 6G6i. In Section 2Q, we covered the accountability of the customer and supplier. In addition to accountability, both the customer and the supplier have rights as well as responsibilities.
    • 6G6ii. Supplier rights:
      • 6G6iia. To have a partnership relationship with the customer.
      • 6G6iib. To negotiate an agreement with the customer that the supplier will be able to fulfill.
      • 6G6iic. To have a prioritized list of requirements and to only include in the deliverable agreement those requirements that can be resourced.
      • 6G6iid. To include contingency time, effort, and money in the estimate.
      • 6G6iie. To be informed as early as possible if there are changes with the customer that would affect the supplier’s ability to meet his commitment to the customer.
    • 6G6iii. Customer rights:
      • 6G6iiia. To be given accurate estimates of what the deliverable will cost to produce, and the amount of time needed to produce it.
      • 6G6iiib. To be notified as early as possible if the supplier will not be able to meet his commitments.
      • 6G6iiic. To receive the deliverable that has been agreed to within the cost and deadline constraints.
    • 6G6iv. Supplier responsibilities:
      • 6G6iva. To provide accurate estimates of cost and duration.
      • 6G6ivb. To do everything humanly possible to meet his commitments, and if he will not be able to, to notify the customer as early as possible.
    • 6G6v. Customer responsibilities:
      • 6G6va. Treat the relationship with the supplier as a partnership.
      • 6G6vb. Negotiate an agreement that the supplier can meet with the resources available.
      • 6G6vc. Prioritize the requirements for the deliverable to be produced by the supplier.
      • 6G6vd. Allow the supplier to include adequate contingency time, effort, and money so that he can meet his commitments, even if unexpected problems occur.
      • 6G6ve. Notify the supplier of changes that would affect his accountability.