Evaluating your way to exceptional supplier performance


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Slides from the webinar Evaluating Your Way to Exceptional Supplier Performance by Intelex's Fraser Dickie

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Evaluating your way to exceptional supplier performance

  1. 1. Evaluating Your Way to ExceptionalSupplier Performance By: Fraser Dickie, Account Executive
  2. 2. Agenda: 1. About Intelex2. Supplier Performance Management 3. Methods of Rating Suppliers 4. Conclusion
  3. 3. We develop, implement and support software for: • Quality Management • Environmental, Health and Safety Management • General Business Management
  4. 4. We were established in 1992
  5. 5. We have a worldwide client base
  6. 6. We have over 180 employees
  7. 7. Our software powers over 700 global customers andover 500,000 users
  8. 8. We have clientsacross all industries
  9. 9. …well that’s enough about us. Let’s talk about…
  10. 10. SupplierPerformanceManagementThis is what you need to know
  11. 11. 1 Selecting Key Suppliers2 Who Should Evaluate These Suppliers3 Which Key Performance Indicators (KPIs) to track
  12. 12. 1Selecting YourSuppliersThis is what you need to know
  13. 13. Who are you having the most issues with?
  14. 14. Who are you spending the most money with?
  15. 15. Who are those 20% that have the biggest impact on your supply chain?
  16. 16. Identifying HighImpact Suppliers
  17. 17. “What would the impact be on my business if thissupplier delivered lateor supplied low quality product?”
  18. 18. Would this cost me money?
  19. 19. What would be the impact of poor product quality or ifthey had a nonconformance?
  20. 20. Would this damage my reputation?
  21. 21. Could I face fines?
  22. 22. Would I lose customers?
  23. 23. What would the impact be on my business?
  24. 24. 2Who ShouldEvaluate Suppliers?
  25. 25. “Anyone who interacts directly with the supplier should have the opportunity to provide input on the supplier score.”
  26. 26. In many cases this may include:• Purchasing• Quality• Production
  27. 27. 3Which KPIsTo Track?
  28. 28. Popular KPI’s forperformance management:3CQL – Cost, Capacity,Capability, Quality, LogisticsServiceComplianceSafetyFinancialsInformation Protection
  29. 29. If you use cost as a KPI,you might want to know:• Are they offering the lowest cost?• Have they given us reduced shipping costs?• Do we have the best payment terms?• What process improvements are they offering?• Are we getting bulk discounts on packaging?
  30. 30. If you use delivery as a KPI,you might want to know:• Do their products arrive on time?• What is the lead time?• Do they adhere to lead times requested?• Do they have shortages when they arrive with their product?• Do they adhere to shipping requirements?
  31. 31. If you use service as a KPI,you might want to know:•Are they friendly to work with?•Do they provide excellent technical support?•Do they resolve discrepancies quickly?•Do they respond to emergencies effectively?•Do you know your main point of contact?
  32. 32. If you use quality as a KPI,you might want to know:• Do they frequently have product defects?• Do they exceed specifications?• Do they have nonconformances?• Do they act on nonconformances?• Do they conform to quality standards?
  33. 33. How to capturethis information?
  34. 34. Supplier SurveysMay seem easy but there are accuracy issues with this approach and it relies on suppliers providing the information
  35. 35. System Metrics Some of this data (cost, deliverytimes, service expectations, defects) may already exist in your ERP, Financial or HR software systems
  36. 36. Performance Management Software The most efficient system, and it canleverage your existing system metrics
  37. 37. SupplierScoring
  38. 38. Impact based on type Minor (near miss) Major (shut down line) Critical (safety/high cost)
  39. 39. Cost of poor quality Internal cost of issueOvertime, late delivery fines Charge backs to supplier
  40. 40. Responsiveness ContainmentTime to respond to issue
  41. 41. Effectiveness of Corrective Action Risk assessmentLikelihood vs. consequences of this happening again
  42. 42. How to UsePerformance Info?
  43. 43. Supplier Management Software Intelex Supplier Management System •Corporate wide data rollup •100% web based •Supplier portal Evaluation Methods •Supplier surveys •ERP integrations •Supplier NCR & CAPA Utilizing Supplier Performance Info •Supplier scorecards •Supplier dashboards and portal
  44. 44. Thank You Fraser Dickie Intelex Technologies Inc.Visit www.intelex.com for a free trial