PPI’s WRI® model is comprised of five major components with each component containing two or more variables (Figure 1). Each variable is represented by one or more questions in the survey questionnaire. The value of each individual variable is the average response of the suppliers who answered the variable-related question.
The WRI® metric is calculated by combining a weighted average response of each variable of a specific component to obtain the component score. Each of the five component scores are then weighted and combined to provide an overall WRI® metric for each company or other client-defined category within the company, e.g. division, geographic region, manufacturing site, purchase area, etc.
The WRI® model was created by Professor John Henke in 2002, ten years after he began conducting in-depth confidential supplier surveys for various North American OEMs, which evolved into the Annual Automotive Industry™ Study. The results of the Annual Studies were captured in a comprehensive PPI supplier working relations database. Using this data, Professor Henke, through rigorous statistical analysis and modeling, discovered and verified that the behavior variables of the WRI® model (Figure 1) were an accurate quantitative measure of a company’s working relations with its suppliers.
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