Cut Your Losses…Literally

PearRecently I spoke with a pear grower in the Hood River Valley about how he raises his trees. He said that after he plants a tree, it takes about three years of nurturing, growing and pruning before it delivers its first crop. Then it continues to improve until year 10, when it is in full production. A good tree will yield fruit for up to 40 years.

Growers can tell the quality of a tree even before its first year of production by looking at the tree’s structure and buds. If the tree is not commercially viable, they cut it down, or take the top off and graft on a new one. This seems a bit ruthless, especially after investing in the tree in the first place and nurturing it for growth.

As I thought about this, it struck me as very similar to the way smart companies manage their suppliers.

  • Invest in good suppliers (i.e., tree stock) after research and qualification
  • Nurture the relationship with good specifications and help with quality and cost improvements
  • As the supplier gains experience in the parts/services they provide for the company, the relationship flourishes
  • As the supplier moves into long-term production, monitor them closely and measure performance

If they don’t produce after nurturing them carefully, cut your loses and move on. Only suppliers that perform to your expectations should be part of the orchard.

© 2011 – Rick Pay – All Rights Reserved

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Filed under Key Performance Measures, Quality, Supply Chain

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