Competitive networks or supplier ‘ecosystems’
There is also an emerging shift from competing industries to competing networks or ‘ecosystems’. Best-in-class companies are those who successfully integrate their suppliers in both innovation and business fulfilment. These relationships are based on transparency, clear goals and honest relationships, creating a win-win situation for both parties through mutual trust, long-term contracts, and accountability and stretch targets.
Philips has a Supplier Development team, which is constantly looking, in close cooperation with our suppliers, for ways to optimize the methods of working together:
- The Supplier Development team offers ideas/support on how to reduce costs,
- The Supplier Development teams can assess your factories on how to produce in a more cost effective way
- We can work with suppliers on 6Sigma/ Waste elimination initiatives,
- or on co-development,
- and on Tier II sourcing
We are eager to listen to suggestions: how to reduce complexity, more platform, more ‘catalogue’, feed-back on Tech Specifications, etc. Furthermore, we need innovative ideas from our suppliers; we want to be the first they come to for those ideas to be implemented in our Philips Products ("Innovation campaign")
They are the experts in their business, we count on them… For Philips the relationship with Suppliers is a partnership.
Policies and Procedures
Being socially responsible and making our products socially relevant is not an option, it is a must. Quality for the user and respect for the environment.
Philips General Business Principles of integrity, fair trade, non-discrimination and equal opportunity apply to both our corporate actions and to the behavior of individual employees on company business. Our employees must also act in accordance with the Philips Procurement Code of Ethics.
Philips uses a standard General Purchase Agreement (GPA) and standard contracts based on processes common to all our businesses. In addition, we have standardized processes for measuring and evaluating supplier performance, and for reporting the results.
Supplier Sustainability & Environment
Philips has a deep commitment to embedding sustainability in every aspect of our global organization and supply chain. We believe that for us to become a truly sustainable company, our suppliers must join with us in this commitment, based on a shared set of values and principles.
Philips is committed to improving the quality of people’s lives. This is what drives Philips in the development and manufacturing of our products. Promoting acceptable working conditions, environmentally responsible management and ethical behavior are important parts of our commitment.
In search of mutually beneficial relationships, we will award business to those suppliers who are committed to living up to these expectations. As part of this joint approach, we will be there to support our suppliers in cases where they need to improve their performance. Together we will strive for continued improvement.
Our suppliers also play a pivotal role in helping us achieve our EcoVision objectives. We continue to support them in their efforts to improve the overall sustainability of their business. To read more on our EcoVision: http://www.annualreport2013.philips.com/content/en/sustainability_statements/ecovision.html
For further information on supplier sustainability, please visit http://www.philips.com/about/company/businesses/suppliers/suppliersustainability.page.