Deere & Company headquarter in Moline, Illinois was founded in 1837.In 2007, they conducted business in over 110 countries and employed approximately 47,000 people worldwide. Their employment rate grew to over 67,000 individuals as shown in the Statistics, 2014. They are the world’s leading manufacturer of farm and forestry equipments and also produce construction, commercial and consumer equipments. Other products and services produced by Deere included; equipment financing, power system, special technologies and healthcare. In 2006 members of John Deere’s supplier evaluation team were discussing issues on a long time supplier, Complex Parts, performance. Over the past year, their service had declined resulting in an unfavorable and less profitable relationship between John Deere and Complex Parts and the supplier evaluation team was tasked with providing a recommended course of action to their project manager. Deere’s achieving excellence program (AEP), a supplier evaluation process that promotes communication, trust, cooperation, and continuous improvement, has served as a grading base for their suppliers. The AEP evaluates on a yearly bases, key parts on how a supplier is performing. It focuses on five key areas; quality, delivery, cost management, wavelength and technical support. The program classifies each supplier, from best to worst as either partner, key, approved or conditional. AEP effectively assesses the supplier’s commitment to its relationship with Deere in such areas as; enhancing communication, lowering cost and improving design. Complex Parts had been a supplier for John Deere for over ten years with annual sales to their Moline unit of approximately $ 3.5 million. Complex Parts’ responsibility was to manufacture a key part that required significant engineering input and testing and had remained John Deere’s only supplier of this part, even though two other suppliers can also supply it. Complex Parts was a supplier who was...
References: Accounting Tools (2014) Accounting Tools. The Weighted Average Method. Retrieved on October 4, 2014 from: http://www.accountingtools.com/weighted-average-method
The Statistics Portal (2014) Statistical. John Deere’s Workforce 2002-2013. Retrieved on October 4, 2014 from: http://www.statista.com/statistics/278010/john-deere-number-of-employees-since-2002/
Wisner, J. D., Tan, K., & Leong, G. K. (2012). Principles of Supply Chain Management (3rd ed.). Mason, OH: South-Western.
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