Some companies keep their focus strictly on their own operations, but not SunPower Corp. This past spring, the company began partnering with its suppliers to find better ways to deliver their services, resulting in better products.
Together, “There’s a better understanding of how our product quality impacts the end-customers,” Chief Procurement Officer and Vice President of Supply Chain Mike Kienitz says. “Both parties are focused on how we supply sustainable improvements in quality.”
Based in San Jose, Calif., SunPower designs and manufactures high-efficiency solar panels and systems for the residential, commercial and utility markets. Dr. Richard Swanson co-founded the company in 1985.
Since then, SunPower has earned more than 500 patents for solar technology and as of the end of 2014 generated 25 million megawatt hours of electricity. The company has grown, Kienitz notes, with an emphasis on technology and quality leadership.
As part of this focus, SunPower takes its panels to independent labs to test their efficiency. “All of those labs [found] a significant difference between SunPower and our [competition’s products],” he states.
“We are the technology leader and the leader in terms of quality as defined by how the module performs over time,” Kienitz says. “We see ourselves as a leader in customer focus and customer engagement as well.”
SunPower recently implemented its supplier engagement program, which focuses on elevating its interactions with its suppliers. “We’ve tried to focus on aligning with suppliers, especially in terms of quality, technology, having the right locations and the ability to scale with our business,” Kienitz describes.
The company also objectively assesses its suppliers’ performance so it can help them continuously improve. “We’re mutually developing an A3, a problem solving approach with our suppliers that looks at where strategically both companies want to take the business,” Kienitz describes.
If SunPower wants to implement statistical project controls throughout its process, it helps the supplier do the same. “We’d work with the supplier [on the timing of implementing] those improvements,” he says.
The company also has implemented three ranks for its suppliers: a certified supplier, a strategic supplier and a partner supplier. “As you progress up that chain, the expectations progress substantially,” he says.
If the company achieves the status of a certified supplier for SunPower, “You’re an approved supplier and you meet all of our standards,” Kienitz says. “Above that are strategic suppliers.
“We have quarterly business reviews with them,” he continues. “At the strategic supplier level is also a portion of preference for business allocation and new business awards, as well.
SunPower started the program this April. So far, “The suppliers’ response has been fantastic,” Kienitz says. “They’re very excited that there’s a clear set of expectations and strategy.
“Secondly, they’re very interested and excited about the fact that we are really creating a closed-loop process for performance and rewards,” he continues. “We’re now able to talk to them about what they’re able to provide in terms of a total solution to SunPower, versus negotiation on a traditional set of metrics. They’re reinforcing our leading approach and customer service.”
The supplier engagement program has led to the formation of a group where suppliers are bringing their technology solutions to SunPower’s engineering, product development and customer development organizations, Kienitz says. One recent example, he notes, was when it had delivery issues with a supplier.
That vendor then implemented a stocking program to address the concern. “Now, we have a partner supplier that will stock this material closer to our customers,” Kienitz says.
SunPower’s implementation of the program also required training for its own employees.
“We’ve had to deploy training on the lean tools, A3s and value stream mapping,” according to Kienitz. “We’re in the process of taking that same training and deploying it to the supply base as well.”
Kienitz is proud of the supplier engagement program. “It’s the elevation of our supply chain and our suppliers from really a transactional relationship to one that’s mutually adding value to both of our businesses and our customers,” he states.
SunPower plans to continue using the program. “We’ll reap the rewards and see how they flow through to our customers,” Kienitz says.