Systems suppliers: Towards “best practice”?

This paper is concerned with UK-based automotive component suppliers that have commenced the supply of a “complete system” to a vehicle assembler (VA) in recent years. The wider restructuring of VA-supplier relations occurring in the UK automotive industry is taken asthe context for this research — reference is made to the requirements of lean and agile manufacturing. We investigate if these suppliers differ in any systematic way from their counterparts who have not moved into systems supply. This was done using a questionnaire survey and series of follow-up interviews. Significant differences between systems and non-systems suppliers were found in the areas of firm size, products, customers, design input and VA-supplier relationship strategies. Both parties were typically found to gain from systems supply. The nature of these benefits is then explored. Overall, it is intended that this research should serve to inform management, and in particular that of suppliers seeking to achieve or to maintain and develop their first tier status.