SCORE A Better Way to Do Busine Moving from Conflict to Collaboration

SCORE A Better Way to Do Busine Moving from Conflict to Collaboration

To maximize long term profits, companies and their managers must focus more on win/win collaboration with business partners rather than using coercion and adversarial tactics to force compliance. Stallkamp pioneered new strategies for collaboration as President of Chrysler Corporation. His breakthrough strategy (SCORE–Supplier Cost Reduction Effort)turned Chrysler around and into the world’s most profitable automaker. Organizations ranging from Dell Computer to the U.S. Air Force are now profiting from the lessons they learned from Chrysler. Stallkamp offers a complete blueprint for deploying strategic collaboration with suppliers, customers, and employees. Learn how Stallkamp overcame the pitfalls and cultural obstacles. Stallkamp reveals detailed metrics that demonstrate the remarkable cost and quality improvements strategic collaboration makes possible. Stallkamp’s proven techniques address strategy, communication, leadership, measurement, information sharing, responsibility sharing, and more. Simply put, this is everything needed to establish collaborative relationships that drive unprecedented business value.

User Ratings and Reviews

5 Stars The Power of First-Person Plural Pronouns
The title is an acronym which refers to a proprietary goal and measurement system: Supplier Cost Reduction Effort. Stallkamp asserts (and I wholeheartedly agree) that “adversarial commerce” eventually creates a lose-lose situation. As he explains, “The behaviors Ford and General Motors exhibited…are examples of adversarial commerce. This term describes the negative and domineering manner many companies use to control their relationships in normal business dealings. Adversarial commerce is becoming increasingly common in the business world because it is based on using short-term leverage [e.g. cost slashing at the expense of suppliers] from the value of the business to produce equally quick results.”

In this context, I am reminded of an article written for The Wall Street Journal (October 21, 1993) in which Peter Drucker identifies and then discusses what he characterizes as “Five Deadly Sins”:

1. “Worship of high profit margins and premium pricing”

2. “Mispricing a new product by charging what the market will bear”

3. “Cost-driven pricing”

4. “Slaughtering tomorrow’s opportunity on the alter of yesterday”

5. “feeding problems and starving opportunities”

Presumably Stallkamp is familiar with that article and agrees with Drucker that too many companies are committed to “adversarial commerce” to achieve short-term financial objectives at the substantial cost of their and their suppliers’ long-term best interests.

Hence the importance of SCORE. In 1990, Stallkamp was responsible for Chrysler’s procurement and supply activities. “Although it took some time to get started, by 1992, the SCORE approach had been incorporated into a supply-management philosophy called the Extended Enterprise of the firm. Because their destiny and fortunes were directly linked to Chrysler’s,, the idea was to build a virtual team atmosphere in which all parties focused on reducing the cost of developing and producing vehicles. The construction supply-side suggestions worked to reduce both the supplier’s costs and those of Chrysler.” In this book, Stallkamp traces with meticulous the process by which SCORE was formulated and then implemented as a proprietary goal and measurement system.

He presents his material within 11 chapters, followed by an Appendix in which he provides supporting figures and attachments. By then, I was already convinced of the value of SCORE but this material may well be essential to those who must overcome the objectives of senior management in their respective organizations. The chapter subjects range from “Breaking the Mold” (e.g. the clash of opposite approaches discussed in Chapter 1) to “Breaking the Mold” (e.g. why managed collaboration is “the answer” discussed in Chapter 11). Obviously, as former Chrysler Corporation president and later vice chairman of DaimlerChrysler, Stallkamp speaks from his own extensive real-world experience. He has credibility when, for example, he identifies probable obstacles to “breaking the mold” and then suggests how to overcome them.

I especially appreciate the fact that Stallkamp immediately establishes and then sustains a direct and personal rapport with his reader. The tone is conversational rather than pontifical. Although he carefully identifies each What and (yes) What Not), he focuses most of his attention on explaining Why (and Wy Not) as well as on How (and How Not To). Stallkamp is a pragmatist who possesses exceptionally sharp analytical skills but also, to his credit and to his reader’s benefit, he sees the entire “forest” of collaborative business alliances but also each “tree” (and “stump”) within that “forest.” The direct and personal rapport between Stallkamp and his reader is especially appropriate because, in both spirit and execution, it demonstrates what the nature and tone of business relationships should be when those involved are engaged in collaborative alliance.

In the Introduction, after contending that the basic business model that has developed over the last century might be broken, Stallkamp asserts a premise that companies and their managers can adopt more collaborative and strategic partnerships with related firms in order to help the economy maximize its growth in the future. When concluding his book, Stallkamp reiterates this theme when observing that collaborative management requires planning and effort “but it represents a way to capture the power of working as a true team instead of the waste involved in independent isolation of companies on different agendas.” Stallkamp goes on to say, “Instead of letting nature run its course, managers who embrace collaborative management can help save their firm, their job, and, in likelihood, their economy. There seems to be some risk, but there’s much more to gain if we can just break the mold of tradition that drives conformity in our world.”

Although this book will be of substantial value to decision-makers in global organizations which have a supply management system which is immensely complicated, I think this book will also be of great value to those in almost any other organization which has only a few business relationships but whose success also depends on effective communication, cooperation, and most important of all, mutually beneficial collaboration.

5 Stars Stallkamp Scores
A current book for contemporary times. Adroitly titled “conflict to collaboration,” these principles are more important than ever in today’s global, competitive climate.

Author Tom Stallkamp has the credentials of “having done it.”

At 51, He became President of Chrysler when its future was highly uncertain. His approach was very different from that of GM and Ford, who as of 2006, have serious problems (for a variety of reasons). On the author’s model they “did, what shouldn’t have done,” and he specifically states why. There are critiques of other executives by name. As influential as Stallkamp is in his words and deeds, his success and model is mostly confined within the automotive industry, although this model is intended for all industries.

If you want to learn about supply chains, or if your job or business is related to them, there’s good news for you in “Score!: A Better Way To Do Business.” Stallkamp notes that there are literally thousands of different suppliers in the automotive supply-chain, with numerous levels, costs, Original Equipment Manufacturers, on down. Chrysler was spending 60 billion dollars annually on parts and components. There was a significant amount of waste in the supply-chain of designing, engineering, procuring, building, assembling, and selling the company’s vehicles. Stallkamp’s effort was to eliminate as much of this unnecessary waste as possible, which was adding to the cost of Chrysler vehicles to the consumer. Cutting waste, but while maintaining and enhancing quality, to keep and enhance market share and customer loyalty.

Eleven chapters provide examples and explain why S.C.O.R.E. is not only beneficial and advantageous, but also a must. You’ve likely heard these themes before if you’re in business because they’re so common. This is because they’re so important. Stallkamp provides real experiences to detail how these examples work, and help: Breaking the mold, Adversarial commerce and why it’s wrong “Ending adversarial commerce” was one chapter that reminded me of our global competitive world —> Where in the world is adversarial commerce? (Chapter 3 & 4). And appropriately, the author emphasizes that “Collaboration doesn’t mean ’soft.’”

For the most part “Adversarial Commerce” is not as conducive to success and longevity today as it was in the past. Supplier Cost Reduction Effort promotes a win-win situation (of mutual benefits) with suppliers that is a part of the concept of Stallkamp’s Extended Enterprise. Global competition of outsourced domestic companies abroad as well as foreign companies have the reduced costs – both of these are our overseas competitors. This makes s.c.o.r.e. an important concept for American Business to compete, survive, and prosper with those that peg currencies and have cheaper labour costs. We must maintain our keen ability to adapt, be innovative and creative, constantly. If we do not we will lose our standing.

Stallkamp also reiterates some other comment points worthy of practicing. Danger of short term thinking and myopic financial goals.

One point the author noted:

Information is power: share it. In certain contexts yes, but some see information as not only power but having critical value to survival and maintaining market share. If information is shared with certain suppliers in the Extended Enterprise, then some competitors can use it to their advantage. And, sharing and openness is not always reciprocated. Some of his advocacy of sharing information is in the Finance Departments of companies who he claims, are generally secretive. However, Stallkamp support his point by explaining in detail WHY we should share information. The Machiavellian approach to business is largely counter-productive.

One of Stallkamp’s main goals was to be as lean as possible. In the end, It’s perceived by some that one of the major reasons for Stallkamp’s departure from Chrysler after the Daimler merger (to DaimlerChrysler) was this lack of focus on being lean by the Daimler side.

Stallkamp also has an amiable writing style and doesn’t come off as didactic. Highly recommended and relevant to today’s world – and your job.

5 Stars There’s No “I” in SCORE as Benefits Multiply Through Collaboration According to an Executive Who Knows
If there is a corporation intimately familiar with the consequences of communications breakdowns, it’s DaimlerChrysler, the high profile merger that rocked the automotive industry in 1998. Former vice chairman and president Thomas Stallkamp – who is given much of the credit for stabilizing the unwieldy result of the consolidated company – lucidly explains his proven collaborative management principles in a crisply written book. His timing seems especially appropriate given the encroaching dominance of China as a global economic power and the increasingly irrelevant ways in which companies traditionally manage their output and people, in particular, the manufacturing and industrial sectors.

Collaboration is the key, according to Stallkamp, and the methodology he espouses is called the Score system. Although his open-communication model is based wholly within his automotive industry experience, he is quick to point out how applicable it is to any company. His model at Chrysler was an incentive program which encouraged suppliers to submit suggestions voluntarily with the goal of realizing cost reductions in doing business with Chrysler. The author goes into how-to mode with ease in describing how to monitor, measure, and track the results of a Score system. For such an idealistically conceived structure, he lends a welcome, credible realism to his perspective by not demanding that all the savings generated by supplier ideas be passed on to the company, that some should be kept by the suppliers to retain their own profit margins.

The whole point is that both supplier and manufacturer benefits from the arrangement. Conversely, Stallkamp does not respect the management arrangement of most finance departments, which work on the principle of hoarding information, rather than sharing it. Stallkamp believes that the adversarial way of doing business prevails most in those industries like retail, the airlines and steel manufacturing, sectors that have been flailing for a while in this country because the myopic perspectives taken by the industry leaders have induced a self-cannibalization effect. With so many companies viewing their supply and demand chains exclusive of their competitors, there are opportunities to expand the category and evolve into an industry leader with Stallkamp’s model. The author feels strongly that management needs to work against their tendencies to focus on demanding, information-exclusive ways of working even during crisis periods when reaching out is more important than ever, especially to customers.

Much of the long-term success of the Score model depends on word-of-mouth around a specific company being a better place to do business. Only when that level of awareness occurs does Stallkamp see such a program being self-sustaining. Applying his thinking in the real world, his old company DaimlerChrysler just announced a new management model in late January 2006 which discussed process streamlining and a greater consolidation of corporate functions. A key example cited is the concept of a “project house”, where engineers from different divisions work together for the benefit of the whole company and thus reducing administrative costs and escalating benchmark levels. It appears Stallkamp’s legacy is assured there.

5 Stars Collaborative Supply Chain Relationships
The basic business model is broken.

During the first three years of the twenty-first century the public has witnessed have been accounting scandals, management malfeasance and acts of simple greed committed by business leaders.

Legislation and regulation has been enacted to restore public and investor confidence. In his book Score: A Better Way to Do Busine$$, Thomas T. Stallkamp calls these “Band-Aids.” There are deeper issues, he says. Today’s adversarial organization model renders collaboration or alliances harder to implement.

Stallkamp, the former Vice Chair of DaimlerChrysler and an Industrial Partner at Ripplewood Holdings, LLC, a New York-based private equity firm, argues collaboration and partnerships with related firms hold the key for the economy’s future growth.

During his 20 years at DaimlerChrysler, the author participated in a unique approach to dealing with external suppliers and employees. SCORE is an acronym which refers to a proprietary goal and measurement system: Supplier Cost Reduction Effort. Using its principles, America’s third largest auto maker raised the level of its corporate performance and financial results.

Stallkamp admits it took time to implement SCORE, but was worth the effort. Joined together in virtual teams, suppliers and the company jointly reduced the cost of developing and producing vehicles. The result: lower supplier costs and lower costs for Chrysler.

The fact Chrysler became the author supplier’s preferred customer speaks volumes. Customers and shareholders were not forgotten in the process. The company reaped the best ideas for its customers while it transformed itself into a profitable cash register for its shareholders.

4 Stars Towards a collaboration approach for procurement and supply
Thomas T. Stallkamp is best known as former Vice Chairman of DaimlerChrysler. He is the Founder/Principal of private consultancy Collaboration Management, Industrial Partner at private equity firm Ripplewood Holdings, and serves on several corporate boards and advisory board of Georgetown University’s McDonough School of Business, and on the faculty at Babson College’s Graduate Entrepreneurship Center.

This book was first published in March 2005 and consists of 11 chapters. The author explains in the Introduction that “this book is built on the premise that companies – and, more important, their managers – can adopt more collaborative and strategic partnerships with related firms, to help the economy maximize its growth into the future.”

The first 5 chapters define the problems with the current, prevalent adversarial systems in our economy. The author explains that under adversarial commerce, the dominant party applies economic leverage in a dictatorial, arbitrary manner. However, “adversarial commerce forces the two parties into a defensive posture that is counterproductive to building longer-term goals.” He discusses in detail the four major business attributes that drive the trend toward adversarial commerce: distrust, poor communication, limited planning, and a constant quest for complete control. So what is needed? “The answer is in expanded use of collaboration to break out of the cycle we find ourselves in presently.”

The remainder of the book introduces the optimistic alternative. “The alternative approach to the adversarial tactics common in today’s economy is for firms to encourage closer collaboration between them… For our purposes, collaboration is any management practice that features close and organized or managed cooperation between independent firms.” The primary unique elements which feature in successful collaboration projects are discussed: sense of partnership and shared interests, shared goals and rewards, open and unfiltered lines of communication, clear definition of the roles and responsibilities, and freedom to make necessary decisions within the scope of responsibility. Stallkamp discusses his experience with Chrysler’s supply base, whereby he used a detailed proprietary goal and measurement system labeled SCORE (Supplier Cost Reduction Effort) to streamline the business or eliminate redundant efforts and costs. “The [Extended Enterprise] concept was to treat suppliers and dealers as independent extensions of the firm.” However, it is important to highlight that collaboration is a soft tactic or result. “It actually requires more planning, forethought, and monitoring than the adversarial system…” The author introduces 6 implementation steps, which are quite similar to those used in change management programs. The key is planning and constant monitoring.

Yes, I do like the latter part of this book. The first 5 chapters form a very long introduction to the problem of adversarial commerce; the remaining 6 chapters provide the solution to the problem. There is a good framework for the solution and the fundamental elements are highlighted in detail. The examples focus primarily on the author’s extensive experience within the automotive industry (Chrysler, Ford and General Motors). However, the principles should be the same for all industries and this book can be used to provide a checklist to monitor, measure, and track progress in the new collaboration approach.

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