Supply Chain Management Accountability

How can accountability be better managed in long, global supply chains? (15 pts)
         Accountability means being held responsible for a task agreed to be accomplished.           In today's world, accountability for global supply chains must extend far beyond signing a contractual agreement. The Mattel case shows us, that even with the most trusted suppliers, a favorable contract with clearly stated terms and policies is not enough. Mattel’s suppliers failed to comply with the regulations set in the contract to not use multiple levels of sub-contractors and to only use paint that was lead free. The extra step that Mattel (and many other companies in a global supply chain) needed to take was to ensure compliance with the agreed upon terms. With the pressures to continue to cut costs and still produce the same quality, companies in global supply chains must be involved with the supplier in every step of the procurement process until a final product has been delivered. As companies continue to engage in business overseas, the following steps can be taken to help better manage accountability in long, global supply chains:

Communication and Collaboration:
         It is very important that companies communicate expectations to their suppliers. The contract would be the first line of establishing what is needed from the suppliers, the regulations that need to be followed, as well as the consequences for not adhering to the contract. To ensure compliance, routine meetings with suppliers must be conducted to outline goals and measure performance. The contracting company should share information with suppliers on things like known low quality raw material suppliers, new regulations, and new technologies.

Training and Education:
         Mattel had 200 employees in Hong Kong whose sole responsibility was training and supervising its Chinese contractors. Questions have to be asked about what type of training and supervising were these employees responsible for giving.  First and foremost, suppliers must be educated on product safety and how important it is that their work reflects the contracting companies expectations. Supplier must be properly trained on best practices in testing the raw materials they receive as well as the final product to ensure they meet quality standards. Since multi-tiered contracting is hard to thwart, implementing employees in new positions to monitor the multi-tiered suppliers would be a valid option.

Verification, Validation, and Inspection:
         Often companies are satisfied with just testing samples that are sent from suppliers. This is not good enough, testing must be done throughout the procurement process on actual production batches. Also, companies must require vendors to do tests on their own products, as well as any raw materials they receive that help produce the final product, so any threats can be found early in the production process. All results should be shared with the contracting company. A common misconception in the global supply chain is that contracting companies are fine just testing sample batches, even though it is known suppliers often substitute less expensive material in final production.