Has the Supplier Become King?

AsianBarbie.jpgHistorically, suppliers have been at the bottom of the list of “key constituencies” for major corporations.

Of course, companies want to develop “strong partnerships.” But, at the same time, they know they control the power in that relationship.

That may be changing for U.S. companies competing in today’s flat world. Just ask Thomas A. Debrowski, a senior executive at Mattel.

On Friday, Debrowski publicly apologized to China’s product safety chief for harming the reputation of Chinese manufacturers, following the recall of nearly 20 million Mattel toys this summer.

On the surface, that must have looked odd to many observers. But the fact is that Mattel manufactures 65 percent of its toys in China. So the company has a lot riding on its relationships there.

I’m not putting Mattel down. The company screwed up, but it appears to be taking the high road here. (Unless there’s more to come.)

However, the situation does point out that in today’s virtual world—where so many services and functions are “offshored” and outsourced—the definition of one’s audiences has never been so broad. For many companies, it’s time to move suppliers up the “communications chain.”