Lean procurement from low cost countries: an innovative framework

The stressed global competition urges organizations to choose delocalized suppliers to take advantage of low cost countries markets and innovations brought by new cultural models. However, complexity of cooperation and coordination makes risks higher. Moreover, distance and variability of the environment generally increase stocks. The paper proposes an original framework to apply lean production concepts to the supply process, overcoming the JIT principle of supplier proximity. The methodology matches the classic improvement cycle by Deming with typical supply chain functions, such as supplier, buyer, quality assurance, planning. An application of the framework in the electro-mechanical industry is presented. Encouraging results on service level, capital costs and transportation costs verify the illustrated approach.