Executive Briefings

Scorecards Can Assess the Long-Term Viability of Your Suppliers - or Can They?

One of the often overlooked and undervalued components of supplier selection is trying to determine the supplier's long-term potential. Simply stated, it is not very difficult to identify the lowest price option during an RFP process. The key for long-term success is based on analyzing each supplier's potential for the long haul, encompassing areas such as strategic alignment, cultural fit, common delivery centers, industry outlook and social responsibility efforts. The best overall strategic value is not necessarily the lowest cost.

The economic downturn of 2009 forced organizations to view supplier selection differently and more holistically than ever before. The long-term viability of suppliers from both a financial and quality standpoint is more important than ever. It is through this increased focus on due diligence that sustainable value is captured.

So how can supplier selection be more effective in addressing concerns about future quality and financial stability? A common tool may hold the key - the scorecard. Scorecards are widely used for measuring performance, but what story do they really tell? Do they tell enough? Is the information timely? Can scorecards provide more insight into the selection process? It depends.

Measuring supplier performance is certainly an important and necessary component of ensuring value. However, it involves more than gauging customer satisfaction, percent of on-time delivery, defective parts per million or quality of service. Done effectively, supplier management is not static but a constantly moving part. And it begins even before the supplier is in place.

Read Full Article


Keywords: Supplier Relationship Management, Technology, Legal, Govt. & Regulatory Issues, Supply Chain Security & Risk Mgmt, Quality & Metrics, Supply Chain Analysis & Consulting, Global Supply Chain Management, Supplier Stability, Supplier Management

The economic downturn of 2009 forced organizations to view supplier selection differently and more holistically than ever before. The long-term viability of suppliers from both a financial and quality standpoint is more important than ever. It is through this increased focus on due diligence that sustainable value is captured.

So how can supplier selection be more effective in addressing concerns about future quality and financial stability? A common tool may hold the key - the scorecard. Scorecards are widely used for measuring performance, but what story do they really tell? Do they tell enough? Is the information timely? Can scorecards provide more insight into the selection process? It depends.

Measuring supplier performance is certainly an important and necessary component of ensuring value. However, it involves more than gauging customer satisfaction, percent of on-time delivery, defective parts per million or quality of service. Done effectively, supplier management is not static but a constantly moving part. And it begins even before the supplier is in place.

Read Full Article


Keywords: Supplier Relationship Management, Technology, Legal, Govt. & Regulatory Issues, Supply Chain Security & Risk Mgmt, Quality & Metrics, Supply Chain Analysis & Consulting, Global Supply Chain Management, Supplier Stability, Supplier Management