Harley –Davidson now expects suppliers to focus strategically on cost. Delivery, and quality improvement and to hit established cost and quality target. suppliers and to hit established cost and quality targets. Suppliers are expected to meet twice the level of quality and to develop a written straiegic plan to achieve goals for quality improvernent. Suppliers are graded according to defective parts-per-million and it has a target goal of 48 defective parts-per-million that suppliers are expected to achieve Harley-Davidson sends suppliers a monthly report showing their quality and delivery performance, and if the supplier receives a bad report Harley-Davidson sends their people to the supplier to determine the problems and help them resolve them. If the supplier does not improve its performance. it is replaced. In 1995 defective parts-permillion for suppliers were generally around 10000; however; by 2000 approximately 60% of Harley-Davidson’s supplier base was performing at 48 defective parts-permillion or better, and 36 supplicrs were performing at zero defective parts-per-million. Harlcy-Davidson also expects its suppliers to develop and deliver new products in half the time; and they are expected to develop loots for taster product development and plans that are supportive of Harley-Davidson’s design and developmcnt efforts. Onsite suppliers take part in new product design,creating an interface between the company and its suppliers that helps Harley-Davidson improve quality and cut costs.