The influence of external factors on the organization. The influence of suppliers on the functioning of the organization How suppliers influence the enterprise

CONTENT

Introduction 3
1 Direct impact factors 4
2 The influence of suppliers as an environmental factor of direct impact on the organization and organizations on this factor 10
2.1 Influence of material suppliers 10
2.2 Capital providers 11
2.3 Labor suppliers 11
Conclusion 18
Literature 21

Introduction

From point of view systematic approach organization is a mechanism for transforming inputs into outputs. The main types of inputs are materials, equipment, energy, capital and labor. The dependence between an organization and the network of suppliers that provide the input of these resources is one of the most striking examples of the direct impact of the environment on the operations and success of the organization. Obtaining resources from other countries may be more profitable in terms of prices, quality or quantity, but at the same time it is more dangerous due to increased environmental factors such as fluctuations in exchange rates or political instability.
In some cases, all organizations in a particular region do business with one or nearly the same supplier. Therefore, they all become equally dependent on the actions of the supplier.
A good example is energy provision. All organizations receive energy at prices set by the government (an example of interdependent external variables) and are rarely able to find an alternative supplier, even if the organization believes that the current energy supply is inadequate or too expensive. Changes such as a supplier raising prices will affect the organization to the extent that it uses energy. For example, the sharp drop in gasoline prices in 1986 affected every organization in the world to some extent, but the impact was much greater on gasoline-dependent firms, particularly those involved in the transportation of goods and passengers by road, air, and passenger.
The purpose of this work is to study the influence of suppliers as an environmental factor of direct impact on the organization and organizations on this factor.
The structure of the work consists of an introduction, the main part, a conclusion, and a list of references.

1 Direct impact factors

Representatives of classical management schools analyzed primarily the internal factors of the organization*. External factors remained outside their field of vision. However, any organization exists surrounded by the external environment (suppliers, competitors, consumers, etc.). The external environment is constantly changing and has a great influence on the organization. Many authors in the field of management theory and practice note that until about 1975, the external environment was relatively stable and calm. It was before this period that the American management model worked effectively. It was characterized by the following symptoms:
– the result of the company’s work depends on internal factors;
– the company is considered as a closed system;
– the goals and objectives of the company remain unchanged for a long time;
– no significant structural changes;
– long product life cycles;
- mass production;
– maintenance of large warehouses for raw materials and finished products.
From the mid-70s to early 80s the situation became more complicated. IN environment are starting to pass global changes:
– the need to quickly change manufactured products;
– the consumer dictates to the manufacturer;
– tougher competition;
– frequent innovations;
– managers must respond sensitively to changes in the external environment;
– the need for reorganization (reengineering);
– reduction in the size of the organization.
In management thought, the idea of increasing the influence of the external environment on the activities of the organization arises and then strengthens. Moreover, “the external environment of the organization is increasingly becoming a source of problems for modern managers. In fact, the leaders of the most important organizations for society - under the influence of events occurring in the world, have been forced to focus on the rapidly changing environment and its impacts on internal structure organizations"
Almost all environmental factors are uncontrollable by the organization and its services. The best plan can fail due to the negative impact of uncontrollable factors. However, it should be noted that organizations can not only adapt to a changing environment, but also, to a certain extent, influence it.
When analyzing external factors, two types are usually distinguished: direct impact factors, sometimes called the immediate environment, and indirect impact factors, sometimes called the general environment.
Direct impact factors are those that directly affect the organization's operations and are directly affected by the organization's operations.
The organization and its environment can be represented as follows (Figure 1). Let us briefly characterize the external environment of direct impact on the organization.
1. Suppliers. This category of external environment usually includes:
a) suppliers of materials, energy, equipment and components, i.e. here there is a dependence on prices, deadlines, rhythm, quality, etc. Moreover, this dependence has recently been increasing with the deepening of the division of labor and the development of cooperation. Firms are increasingly focused on the primary purchase of components from partners, and the firms themselves carry out only certain operations, and this is typical for both manufacturing and firms operating in the service sector. Therefore, we can talk about increasing their dependence on suppliers in the future. At the same time, changes are taking place in the relationship between purchasing firms and supplying firms, based on the Japanese subcontracting system and the organization of an effective supply chain. At the same time, additional powers and responsibilities are transferred to suppliers both in the field of design and production, which allows us to talk about supplier management;

Figure 1. Organization and its environment
b) suppliers of capital and financial services, here there is a dependence on volumes, terms of loans and mutual settlements, insurance services, etc. Usually the following investors are distinguished: banks, insurance companies, other financial and non-financial companies, programs government agencies for the presentation of loans, shareholders and individuals.
Large companies strive through high level profitability to ensure financial independence and serve as banks for themselves and even finance other companies (sometimes this is in...
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Wholesale trade occupies an intermediate link between producers (suppliers) and consumers (retailers). Thus, both suppliers and consumers influence the activities of the wholesale enterprise and marketing decisions. Marketing mix activities can bring negative results without taking into account the influence of these factors.

Suppliers influence the following factors in the company's activities: 1) quality of goods. Products offered to wholesalers must be of the best possible quality. Therefore, LLC “HDC Company” cooperates directly with manufacturing plants that produce products based on international standards ISO 9000 quality; 2) price. To reduce the negative consequences of this factor, the Company is engaged in purchasing activities from several suppliers with the aim of relative independence. In addition, the Company tries to enter into contracts with suppliers with fixed prices for a long period. Changes in the pricing policies of other suppliers are also constantly monitored; 3) assortment - by studying the tastes and preferences of consumers, suppliers are selected whose auto parts are in greatest demand; 4) quantity of goods - the company plans to purchase such a quantity of goods that the following conditions are ensured (delivery in the required quantity to consumers, maintaining the necessary stock in the warehouse, discounts for the volume of purchased products, organizing delivery); 5) timeliness - HDC Company LLC plans to purchase goods exactly on time, convenient for the buyer. To do this, through negotiations with suppliers, the terms of shipment are agreed upon; the company organizes further delivery to the end consumer using its own transport, and, if necessary, hired transport. The main suppliers are Melitopol Bearing Plant LLC, Kharkov Bearing Plant OJSC - HARP (KharP) - Kharkov Bearing, Kharkov Tractor Plant OJSC, Kremenchug Automobile Plant CJSC (KrAZ CJSC), Zaporozhye Automobile Plant CJSC (ZAO "AVTOZAZ"). The choice of suppliers is determined by the optimal price and quality and the possibility of timely delivery. The company has entered into dealer agreements and is a direct representative, which ensures the best delivery conditions.

Consumers are one of the most significant uncontrollable factors. How successful a business will be depends on satisfying consumer needs in the best possible way. Although the enterprise determines the choice of target market for auto parts, it cannot control its characteristics. He can only react to them - the volumes and range of ordered supplies of goods and services, relative attention to prices, forms of ownership of retail stores, the degree of their concentration in the service area, etc. - all that potentially influences the purchase of wholesale products by customers one or another type or volume of these products.

Consumers directly influence the level of demand and indirectly influence a number of other decisions in the field of marketing, assortment policy, prices, incentive methods, and location of the enterprise.

At HDC Company LLC, these problems are solved by the sales department by identifying needs (conducting surveys, negotiating with customers). For example, a shortage of tires for trucks and tractors was identified, which were purchased in Moscow at a more expensive price and of low quality. The response to this was purchases from Ukrainian factories that have large production capacities and production experience, interested in searching for a sales market in Russia, offering products at a lower price. In addition, the company pursues a reasonable pricing policy to attract buyers (relatively low markup, lower than that of competitors, a system of discounts), strives to create long-term partnerships with buyers (attracting regular customers) and is engaged in improving service, it was revealed that for buyers attractive are deferred payments, prompt delivery and availability of stocks in the warehouse (for this, the company has the possibility of direct deliveries or storing goods in a warehouse, credit).

Suppliers and consumers have a huge influence on the activities of LLC “Company HDC” and on the decisions it makes in all areas of activity, including marketing. Suppliers influence the price of auto parts, quality, breadth of assortment, timeliness of deliveries, consumers directly influence the level of demand and indirectly influence the price, promotion methods, assortment. Therefore, the wholesale enterprise must be focused on consumers and suppliers and take into account their influence. The negative influence of suppliers can be reduced by searching for the most advanced enterprises in terms of product quality and range, purchasing from many suppliers instead of one - thereby creating relative independence of the wholesale enterprise. What is important for consumers is a wide range, quality, discounts and deferred payments, level of service, and the ability to deliver on time. HDC Company LLC takes this into account when formulating its marketing policy and monitors changes in consumer preferences and reactions to ongoing marketing activities.

Chapter 5 Main directions for improving the marketing activities of an enterprise

Analysis economic potential LLC “Company “HDC” for 2005 -2007, given in Chapter 2 course work showed that profits, although quite high, tend to decline while maintaining the level of costs. This may be caused by various factors: increased competition in the auto parts market, oversaturation of the sales market in the Belgorod region, and a decrease in the quality of work of the wholesale enterprise. All this speaks to the need to improve the marketing activities of the enterprise, aimed at increasing sales volumes and, ultimately, profits and competitiveness.

First of all, in the organizational structure of the enterprise, it is necessary to remove the functions of wholesale purchases from suppliers from the sales department (analysis and search for suppliers, the negotiation process, contractual work, organizing purchases and delivery to the warehouse) and create a purchasing department. Because the sales department performs too many functions that make it difficult to focus on the main, actually, sales activities. The efficiency and quality of work are steadily declining. This is also shown by the operating experience of other trading enterprises, such as Trading House Perekrestok, Eldorado, Wal-Mart. However, these two purchasing departments must cooperate very closely with each other, since their activities are interconnected.

In terms of organizing the marketing complex at the enterprise, there is no program of activities developed and approved by management, either in writing or orally. The actions of the sales department are reduced to following the instructions of the head of the organization on specific issues, and not to systematic activities. In my opinion, this drawback is significant: the development of the program allows you to systematize the activities of the entire marketing complex; evaluate the effectiveness of ongoing activities; Allows you to link sales activities with the overall company strategy; allows you to monitor the activities and final performance of the sales department employees if you enter into the program control targets that need to be achieved.

The company does not conduct a full analysis of competitors (primarily pricing policy is studied), but it is necessary to conduct a comprehensive study of competitors (product range, level of service, promotional activities, advantages and disadvantages).

An analysis of the economic potential also showed a significant amount of receivables; this is always not a positive factor, and in a crisis the danger increases, since borrowers may go bankrupt and not repay the debt. In this regard, in marketing activities to stimulate sales, it is proposed to change the policy of supplying goods on credit: to provide goods with deferred payment only to reliable customers under some fixed guarantees, including the property or fixed assets of the borrower; reduce the deadline for debt repayment, after which measures, including pre-trial measures, are applied; carry out measures to retain clients in connection with the current situation (negotiations, explanation of the feasibility of the measures taken). This will reduce accounts receivable while maintaining the customer base.

The product (assortment) policy should be revised, consisting not in the supply of all types of auto parts, but only those for which the demand is either small but stable or products for which the demand is steadily growing. Effective procurement management involves ranking goods for certain periods of time (quarter, year) by category (increase in sales volume; decrease in sales volume; goods whose sales volume has changed little). Further, the indicators are analyzed to determine what caused the decrease in the profit of the goods and a decision is made to reject these goods, reduce their total volume of purchases, or increase the amount of work to stimulate these goods.

Settlements with counterparties are carried out non-cash; therefore, payment in cash can lead to an increase in the client base by attracting new consumers and to expanding cooperation with existing clients.

To best promote the company and its products and services, it is advisable to create a website and participate in e-commerce. The costs are the creation and management of the site and the monthly payment for the domain (registered address), which is a negligible amount. However, the benefits of creating a website will far exceed the costs and can consist of several directions that simultaneously affect the profitability of LLC “HDC Company”: 1) increasing the customer base due to those who visited the site on the Internet, and not necessarily from Belgorod region; 2) recognition of the company, creation of a positive image; 3) acceleration of turnover of goods; 4) lower costs compared to advertising and campaigns to attract attention (exhibitions, reports, articles) and a large audience worldwide. To do this, the site must meet a number of conditions: 1) a catalog must be presented with the full range, prices and discounts in real time and with constant updating; 2) it is also advisable to place product quality certificates, company awards, names of contractors of well-known clients and suppliers - this has a positive effect on the company’s image as a supplier of quality products of the factory standard. This could be just a website informing about the company and its products, or you can create an electronic store with payments through electronic payment systems and orders through the website.

Thus, to improve marketing activities, it is necessary to change the functions of the sales department in the organizational structure (removing purchasing activities, focusing efforts on marketing) and create a purchasing department, establishing effective interaction between them. The activities of the sales department must be organized and regulated by creating a marketing plan (program) for the enterprise, which describes the activities being carried out, goals and objectives, and benchmarks. Purchasing activities should be organized, on the one hand, by identifying consumer preferences through various surveys (questionnaires), and on the other, based on procurement management based on the criterion of sales efficiency. Settlements with counterparties (buyers) can also be made in cash. Creating an Internet site will contribute to the effective promotion of auto parts and company recognition at low costs and a wide audience.

Who are your suppliers - friends or enemies? In fact, it’s both. It all depends on how you build relationships with them.

This article is devoted to how to use the reserves hidden in well-built relationships. And the basis of this is choosing the right strategy.

Increasing competition and rising prices are forcing Russian companies to seriously think about cutting costs. Research shows that about 50% of reserves are in the procurement area. The remaining 50% can be found in management, production organization, logistics and other areas of activity. That is, the main reserve lies in purchasing optimization. The largest players are paying increased attention to this area. RAO EC fully regulated the procurement activities of its subsidiaries and introduced mandatory competitive procedures. JSC AVTOVAZ has seriously increased the number of its suppliers. Many holding structures are engaged in centralizing procurement. Abuses are being combated, including constant video recording of negotiations with suppliers. All these examples demonstrate the desire to organize procurement as efficiently as possible.

And at the same time, managers regularly lose sight of one essential point - the suppliers themselves.

In 2006-2008 We conducted a survey of more than 200 buyers of large and medium-sized companies operating in Russia. The survey showed that systematic management of the supplier base is practically not used by Russian companies to improve the efficiency of procurement activities.

A common mistake when working with suppliers is the desire to treat everyone the same. In one company, a request for training for buyers sounded like this: “Make our employees opportunistic buyers.” What this essentially means is, “Get everyone under the same brush, have everyone work with all their suppliers under the same approach and implement the same strategy.” But even at the everyday level, we behave completely differently, choosing, for example, bread in a store or buying a car. So is it worth abandoning common sense in corporate purchasing? It is illogical to behave the same way with all suppliers, since situations are different.

Managers most often choose one or another type of relationship with a supplier, taking into account the following factors:

intuition (“it seems so to me”);
individual predisposition of the leader (for some it is easier to establish partnerships, for others - opportunistic);
the arrangement of market forces (I am weak - I bend for everyone; I am strong - everyone must bend for me);
personal sympathy or antipathy towards the manager or representative of the supplier.

All these factors have something in common, namely: they have nothing to do with a serious analysis of the situation inside and outside the enterprise. In other words, the company largely builds relationships with its suppliers on a whim and expects the purchasing department to constantly reduce costs, improve the quality of purchased products, reduce delivery times, etc.

What kind of relationships with suppliers are possible?

The simplest, although not always the most effective, way is to take a tough stance in procurement negotiations and try to get the best terms, no matter what. Relationships that are built in this way are called relationships based on the principle of economic expediency, or opportunistic. This approach may produce positive results in the short term, but is not always effective in the long term.

As an example, consider the situation that arose some time ago in the office supplies market. Buyers with great market power (for example, large retail chains) could act based on the principle of economic expediency, i.e., choose opportunistic relationships. But when a fire at a plant producing fax rollers created a significant shortage in the market, the winners were those who had established strong partnerships with their suppliers.

Partnership is a fundamentally different type of relationship with a supplier. Of course, intermediate options are also possible. Company Daimler-Chrysler, for example, in addition to a deal with market competition (economic feasibility) and an alliance (strategic partnership), it considers options for coordination (selective competition) and cooperation (selective partnership). But this is already “fine tuning”. The poles remain the same.

An enterprise's supplier base must contain both types of relationships: those built on the principle of economic feasibility (opportunistic) and partnerships. Moreover, as a rule, for several partnerships there are many opportunistic ones. This is due to the fact that both types of relationships have their advantages and disadvantages. If you bring them together, the picture will be approximately the same as shown in the table.

Thus, it is not economically feasible to establish partnerships with all suppliers. And working with everyone only on opportunistic principles is sometimes short-sighted. Both approaches are good - the only question is when and in the relationships with whom we use them. The type of relationship must be chosen based on serious analysis. As practice shows, in many Russian companies this is not entirely true.

Informed choice of the type of relationship with the supplier

So what should we do if we want to make an economically and strategically sound decision? The type of relationship with the supplier, and therefore the negotiation strategy, is much more far-sighted to choose consciously, taking into account the analysis of a number of factors in both the internal and external environment of the enterprise. First of all, we need to analyze what we are purchasing.

Relationships built on the principle of economic feasibility (opportunistic) are suitable for working with non-strategic material or product groups where product customization is not required in accordance with customer requirements. In this case, there is no need to fear that opportunistic relationships with the supplier will negatively affect the quality of the product.

We are talking here mainly about products and services with low purchase volumes, although there may be exceptions to the rules.

If simple products with a high degree of standardization are being purchased, then again it makes sense to resort to opportunistic relationships - especially if suppliers have spare capacity or problems with selling products. In this case, you can always change one supplier or one product to another supplier/product.

The purchasing department should strive to create partnerships when it comes to strategic materials or product groups. These materials and groups belong to the main positions of the enterprise and therefore cannot be purchased anywhere.

If supply items come from industries that deal with complex products that have a low degree of standardization, then partnerships with suppliers are often required. Partnerships are also recommended when sourcing products and services from emerging or monopolized markets where resource shortages may create supply bottlenecks.

A structured analysis of the purchased items is carried out according to four criteria: volume of purchases, share of costs in creating value; impact on the final result; technical complexity; risk associated with receiving. Let's look at each of these groups in more detail.

1. Volume of purchases, share of costs when creating value. The higher the volume of purchases, the greater the share of a particular purchased item in creating the final value, the greater the return you can get from building partnerships with the supplier. To compare purchase volumes for various objects, you can use the classic ABC-analysis. Moreover, it should be carried out not only in cost terms, but also in quantitative terms.

2. Impact on the final result. Different purchased items have different effects on the final product or performance of the trading enterprise. Trading companies have an assortment that, in the opinion of customers, simply must be present on the shelves. Any interruptions in the supply of such assortment could cause significant damage.

The same situation is observed in production. For example, when assembling computers, the processor is much more important than the screws in the case. That's why most people know the names of large processor manufacturers, but almost no one knows who produces the cogs.

The higher the impact of the purchased item on the final result, the higher the importance of a given group of materials or supplier for the decision making of customers (especially the most valuable for the enterprise), the more reasons for choosing a partnership with a supplier.

3. Technical complexity. The simpler the purchased objects are from a technical point of view, the more justified the relationship is based on the principle of economic feasibility. Increasing complexity of purchased objects has an impact on whole line factors that tip the scales of choice in favor of partnership. Firstly, the amount of knowledge about the features of the technology or the purchased product itself (including structural ones) decreases, and consequently, the dependence on the knowledge of suppliers in the field of technology increases. Secondly, Costs increase significantly when changing suppliers (so-called switching costs).

4. Risk associated with receipt. It is worth separating internal and external risks. Internal risks are usually associated with instability of consumption. Its degree can be assessed using XYZ-analysis. The higher the fluctuations in consumption, the greater the flexibility required from the supplier and the higher the risk of not receiving the required quantity of products at the right time.

When assessing external risks, you should pay attention to the following factors:

degree of market monopolization, number of possible suppliers;
presence of deficits of various origins, the relationship between supply and demand;
political risks;
possible force majeure circumstances (an example of this is last year’s strike of Polish customs officers);
geographic location of suppliers and risks associated with geographic location;
other possible threats of supply disruption.

If the risks are low, then this is an argument in favor of opportunistic relationships; if high, partnerships are more justified.

The results of such a structured analysis are conveniently combined into a matrix - for example, in the form in which the company uses it Geberit, a manufacturer of plumbing equipment (Fig. 1).

For strategic materials, it is worth choosing a partnership with suppliers. For non-critical materials - opportunistic relationships. But in relation to materials, the supply of which causes problems, and basic materials, there is no clear solution. The choice is made individually in each specific case.

Conclusion

Having determined the type of relationship with the supplier as a result of the analysis, you can now begin to select an adequate negotiation strategy. Thus, the procurement negotiation strategy is determined in the order shown in Fig. 2.

This approach allows you to make informed decisions in relations with suppliers and plan tactical actions based on a well-founded work strategy. Of course, it requires additional time and effort from the purchasing department. But at the same time, it allows you to reduce costs and increase the degree of adaptation of the enterprise to changing market conditions, not only in the short term, but also in the long term.

Unfortunately, it has not yet found wide application. But our companies simply have no choice: if you don’t look beyond your nose, then sooner or later you will definitely fall into a hole!

1 Stefan M. Wagner. “Supplier Management” (Logistics Bureau) / Transl. with him. edited by A. G. Akhmetzyanova. - M: "KIA Center", 2006. - 128 p.

Basic concepts when answering this question: the external environment of the organization, the environment of direct and indirect action, characteristics of the environment.

The understanding of the importance of assessing the external environment when managing the activities of an enterprise was finally formed in the late 50s, as the external environment of the organization increasingly became and is to this day the source of many problems for managers. Organization like open system depends on the supply of resources, energy, personnel, as well as consumers.

In general, the external environment of an organization can be characterized as the entire set of factors influencing the activities of the organization, namely: consumers, competitors, government agencies, suppliers, financial organizations, sources of labor resources, as well as science, culture, the state of society and natural phenomena.

Since external environmental factors have different powers of influence on the organization, they are divided into direct and indirect factors, and the entire external environment into the environment of direct and indirect action.

Consumers are those individuals who are interested or may be interested in the goods or services produced by the organization. The famous management specialist P. Drucker believed that the only true goal of any business is to create a consumer. The need to satisfy the needs of the buyer affects the processes within the organization, since the number of consumers ultimately determines the necessary production resources, and the characteristics of consumers (what they are) determine the required range of goods and services and their quality. Fundamentally, all consumers can be divided into four large groups:

end consumers, or the population;
industrial consumers, representatives of various sectors of the economy;
intermediaries or trading organizations that purchase goods for resale;
the state as an economic entity.

An important component of the external environment is competitors. Every manager must realize that if he does not satisfy his consumers as effectively (with a certain quality and price) as his competitors, then the enterprise will not be able to exist in market conditions for long. Competitors mean not only those companies that offer the same products but with a different brand, but also companies that produce substitutes. Thus, any organization has two types of competitors:

direct competitors - manufacturers of similar products (for example, Coca-Cola and Pepsi-Cola);
indirect competitors are producers of substitutes (for example, Coca-Cola and Baltika beer).

To conduct business, every company needs external supplies: raw materials, materials, labor resources, capital. In this case, there is a direct dependence between the organization and the network of suppliers that provide the supply of these resources. In the procurement market, the organization is most interested in the conditions for obtaining resources, namely: price, quality and delivery conditions (terms, volumes, terms of payment, etc.). It is these trends in the procurement market that affect the overall turnover of the enterprise.

Some public organizations also have a direct influence on the activities of enterprises. This impact has especially intensified over last years. The influence of trade union organizations that fight for the rights of workers, thereby establishing a balance in relations between owners and hired workers, is well known. The influence of organizations fighting for consumer rights and environmental cleanliness is expanding. For example, in 1992, Russia adopted the Law on the Protection of Consumer Rights, which strengthened the position of public organizations, protecting the rights of consumers to purchase quality goods and to receive reliable information.

The state influences organizations primarily through legislative regulation of activities. The number and complexity of laws specifically targeting business have increased dramatically. Various reporting forms of enterprises and organizations are undergoing changes, tax and customs regulations are changing. The state of legislation is characterized by complexity and fluidity, and often even uncertainty. Uncertainty of today's influence government agencies on business stems from the fact that the requirements of some organizations conflict with others, and at the same time, many organizations have government agencies behind them that enforce such requirements.

The environment of indirect influence refers to factors that may not have a direct and immediate impact on activities, but, nevertheless, may affect them in the future. Here we are talking about the state of the economy as a whole, scientific and technological development, sociocultural and political changes.

Economic forces

Factors in the economic environment must be constantly assessed because the state of the economy affects the firm's goals and how to achieve them. These are inflation rates, the international balance of payments, employment levels, business lending rates, etc. Each of them can pose either a threat or new opportunity for the enterprise. Thus, fluctuations in the exchange rate of the dollar relative to the currencies of other countries can cause the gain or loss of large sums of money.

Political factors

For business it has great importance political stability in society. The level of inflow of investments and other types of resources into a certain region depends on this. The attitude of administrative authorities towards business is expressed in the establishment of various benefits or duties, which either develop business in the region or crowd out business, creating unequal conditions for various organizations. Techniques are also used to lobby the interests of certain industrial groups in government agencies, which also has an impact on the entire business as a whole.

Sociocultural factors

When organizing an activity, one cannot ignore the cultural environment in which it occurs. We are talking, first of all, about the life values and traditions prevailing in society. The standard of behavior is based on this basis. The fundamental difference between American and Japanese standards is known. In the first case, the standard is expressed in an "individualistic" approach to the organization, and in the second - in a "family" approach. Hence, the norm of behavior in one case is the desire for career growth with regular changes of jobs (in the USA it is believed that a person should change jobs every few years), in another - a person works in an organization all his life, treating his boss as a father whom need to listen.

Scientific and technical progress

This factor determines the ability to increase production efficiency, and, consequently, the effectiveness of ways to satisfy consumers. In order for an organization to be competitive, it is necessary to collect, store and distribute large volumes of information about innovations arising in the operating environment. Recently, completely new technologies for processing resources and information have appeared: computer and laser technology, robotics, satellite communications, biotechnology, etc. Researchers talk about the high rate of change in technology, and this trend continues.

International factors

If previously it was believed that the international environment was the object of attention only of those organizations that work for export, now changes in the global community affect almost all enterprises. In the modern world there is a trend of market globalization. This means that the boundaries between businesses in different countries are blurring, transnational corporations are developing, and international economic and political organizations are having increasing influence. To the factors determining the development international business, include: lower costs of doing business abroad, the desire to avoid trade restrictions at home, as well as investment and production opportunities in other countries.

In general, the entire external environment can be characterized as follows.

There is an interconnection of environmental factors or the force with which a change in one factor will affect others.
The environment is represented by a large number of different factors influencing the organization, which shows its complexity.
The environment is characterized by a high degree of variability or mobility.
A large number of factors and their variability lead to the loss of accuracy of information about the processes occurring in the environment, which increases the uncertainty of the environment and complicates the decision-making process.

If we combine the famous Boston Matrix (BCG Matrix) that suppliers use and the Kraljic Matrix that we use, we get an interesting picture that allows us to understand when we have interdependent power, when we can influence suppliers and when power belongs to the supplier . We end up with 16 relationship types and 16 supplier management strategies, respectively. And if we do an additional ABC analysis (on the volume of purchases from a given supplier and on our share of purchases in its sales), then 144 solutions will be determined, which will allow us to approach each case individually. This matrix clearly shows the potential risks of working with a specific supplier and our ability to influence it.

How do suppliers view us?

First, let's look at the Boston Matrix. This model was made many years ago by the Boston Consulting Group.

"Issues" are products that consume a lot of capital in a high-growth market but have low market share. You must decide whether to support this product or stop working with it.

Stars - These products require a lot of capital to finance their growth. They own large share market, the market is growing and the potential of the product is enormous. Subsequently, the stars will develop into cash cows and will themselves finance the development of other areas.

"Dogs" - products that generate enough capital to pay for themselves but do not generate any profit - take up a small share in a declining or stagnant market.

“Cash cows” - these products show slow growth in the market, but occupy a large share of it and provide large profits to the company, which can be used to finance other areas and develop new products.

Thanks to this model, we can understand what niche the supplier has for the products we purchase from him, and calculate the potential supply risks, as well as see opportunities to influence the supplier.

How do we look at a supplier?

The most current model is the Kraljic Matrix, which divides purchased materials, equipment or services according to the degree of value for the company and supply risks.

"Problematic materials"- limited number of suppliers, unreliable supplies, has a relatively low impact on the company’s performance, small volumes of purchases. As a rule, specific products are not mass produced and the power lies with the supplier.

"Strategic materials"- critically needed for production, high supply risk, limited number of suppliers, large volumes of purchases. It is necessary to strive for interdependence, strategic partnerships and vertical integration. As a rule, unique products.

"Basic materials"- standard quality, many suppliers, large volumes of purchases, economic leverage operations. Power is more on the buyer's side, very moderate dependence on the supplier.

"Non-critical materials"- products of standard quality that are easy to buy, do not affect the financial result of the company, product shortages will not lead to production stops, low purchase volumes. The power lies with the buyer.

This model helps us assess supply risks and determine what relationships to build with suppliers on the opportunistic-partner scale.

"Eyes to eyes"

If we combine both models, we get a very interesting picture that will allow us to compare:

the share of our purchase volume in its sales volume (ABC)
the level of importance of the purchased product for us and the importance of the sold product for the supplier
the degree of our dependence on the supplier and the supplier’s dependence on us
the relationship we need and the relationship the supplier needs

As a result, we will clearly see the risks of supplying/purchasing these products from this supplier and we will be able to determine a strategy for developing relations with him, as well as decide on specific actions - from building partnerships to deciding to change the supplier.

We will end up with 16 types of strategies for developing relationships with suppliers and 144 different decisions, which will depend on the comparison of purchase and sales volumes within each cell.

How to use this matrix?

If we consider only the strategic materials-stars relationship, then, at first glance, it seems that both partners depend on each other and must build partnerships; but if we supplement the ABC analysis, we will see that in cases where this supplier is very significant for us (it accounts for the largest volume of purchases - A), and for the supplier we are at the bottom of the sales list (C), then the situation is changing fundamentally, and without an increase in the volume of purchases, the supplier is unlikely to consider us a significant client. In the situation considered, however, we are interesting for the supplier even with small volumes, but if we consider the situation “strategic materials - dogs / AS”, it is immediately clear what huge risks can arise.

Look at your supplier portfolio in this context and you're likely to discover interesting connections and solutions.

We discuss in detail the strategies for working with suppliers and various solutions at the training “Supplier Management.” To order training in a corporate format, call tel. +7 495 649 8616. To participate in the open training, follow the schedule