Vendor and supplier evaluation and assessment practice for the steel industry and the effect it has on operations

Abstract

The purpose of this study is to understand the impact BBBEE vendors have on the operations of companies within the large steel manufacturing industry. In Chapter one all the necessary prerequisites discussed that are needed to become a vendor on the database of large steel manufacturing companies. Chapter two was narrowed down with the emphasis being placed on BBBEE vendors and the different rules and regulations for complying. A quantitative research approach was followed which entailed for plant employees within the large steel manufacturing industry and vendors that rendered a service to the industry to complete a questionnaire. Out of the results of the two questionnaires it was evident that the standard of BBBEE vendors are not up to date and that there are certain risks by making use of a BBBEE vendor. Incubators will form an integral part of the development of BBBEE vendors. Funds will be needed to start up incubators which will give the relevant vendors the skills and technical expertise to form part of the success of a company. The relationship between the vendors and the industry needs to receive urgent attention as the vendors are not confident to approach the companies with their problems. Another shortcoming showed by the study is that the internal non-conformance system does not provide any support in rectifying problems faced by the plants on a daily basis. This system must be improved to ensure that the quality of service is up to standard and any hick-ups will be removed from the manufacturing process. The perceptions of the plant personnel are definitely an aspect that needs to be changed. Therefore, a change management programme will be beneficial for the industry as most of the employees within the industry feel that BBBEE is only advantageous because it is a prerequisite by the government and grants might be obtained by complying.