Int. JournalDevelopment Framework in the Malaysian Automotive Industry: Proton’s Experience
Supplier of Economics and Management 2(1): 29 – 58 (2008)
ISSN 1823 - 836X

Supplier Development Framework in the Malaysian
Automotive Industry: Proton’s Experience
RASHID ABDULLAHa*, MAHARJAN KESHAV LALLb AND
KIMBARA TATSUOc a University Putra Malaysia b Hiroshima University c Hiroshima University

ABSTRACT
In a dynamic market, firms need to evolve from traditional to strategic purchasing which aims to reduce the cost of the purchase and that might imply standardization of components, delivery time and levels of inventory. This effort will usually include key suppliers as joint problem solvers and with these problem-solving models to work with; the firm’s attitude towards suppliers may change from confrontation to trust and partnership. From the buyer-supplier relationship perspective, the procurement practice of the buyer is critical and acts as a window to nurture the supplier development effort. This article presents the result of a study on supplier development in the Malaysian automotive industry, which focused on PROTON, and its role in developing the suppliers’ relationships and development. This study indicates that
PROTON and its suppliers’ development program plays a crucial role in developing and extending comprehensive support to its supplier’s firm such as supplier selection and appointment, development, match making, and promoting continuous performance development and improvement programs.
Keywords: Supplier chain management, supplier relationship management, supply chain management, value chain, automotive industry *Corresponding author. Tel: 03-89467736 Email: abunaqib@econ.upm.edu.my

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International Journal of Economics and Management

INTRODUCTION
In today’s competitive business climate, buying firms