View Full Version : Scorecard Development
08-29-2011, 01:07 PM
I am in the process of re-developing our Scorecard program with the current supply base with the intent to define exceptional suppliers to make them a "Preferred" supplier because they deserve to be. What are some of the measurables used in defining a strong scorecard?
12-06-2011, 02:23 PM
The basics are PPM and Lead Time performance. After you get these down look to include separate metrics for on time delivery to lead time as well promise dates. The PPM can also be expanded in a second phase to include total rejection costs.
The trick is to walk before you run. Often times companies do not have reliable data sources (though they often think that they do) and try to bite off too much their first time. Scorecards should be about driving continuous improvements and developing a weighted data set to make informed sourcing decisions from. You often get only one chance to do it right before your scorecard loses credibility throughout your supply base. This said it is better to take time to validate the data and expand from there.
Long term any scorecard (in my opinion) should include value engineering / continuous improvement targets as well as PPV performance. The reason I do not advocate PPV on the initial launch is that scorecards help procurement teams quantify the true Total Cost of Ownership. Since PPV is heavily monitored outside of scorecards in most organizations...including it in the scorecard too early will take away from the other elements being measured.
Let me know if you have more questions. SHakel320@Comcast.net
01-05-2012, 04:42 PM
Permit me to second SRHakel's recommendation. On-time delivery and perhaps other "delivery quality" measures are a good place to start. They're relatively easy to measure and understand, and you can build from there.
Internally you may get questions like "What about this (that, the other) important thing?" (Ask me how I know.) The answer lies in what SRHakel said about the need to get it right the first time. Better still, get buy-in for doing it that way at the outset, and the question won't arise.
When I was a practitioner I spent 20 years collaborating with other firms on the services side (ag trade publishing, to be specific, until 2009). I've been a buyer and a supplier on the services side, and now I'm doing research in collaboration for my doctoral dissertation, so this is an area of great interest.
01-26-2012, 03:57 PM
In my opinion the score card depends on what your facility values as measurable targets that will improve efficiencies and thus reduce your overall cost of purchasing. The targets that I used are:
Quotes back in a timely fashion 1
Competitive quote 1
Friendly staff 1
late shipment 1
Overall Quality of workmanship 1 1
Price changes 1
Shipment complete 1
Packaging of shipment 1
packing list 1
Sales visits 1
Communication 1 1
Totals 12 3
Overall Percent 80
I made this simple. I weighted each item equally. If I liked the performance, they got a 1 for a pass and if they performed poorly, they got a 1 under fail. If I felt they were both good and bad in a category, they got a mark in both pass and fail. Both columns are added and divided by the total pass to get the percent of overall grade... simple but quick and effective.
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