In the benchmarking world, one of the axioms is to “steal shamelessly” from other companies, meaning: don’t be afraid to borrow ideas from others (not steal proprietary information). When it comes to supplier performance metrics, one of the first questions firms ask is: What metrics do others use? The idea is the borrow supplier metrics from others.
While this approach may give you some ideas, it won’t guarantee that you’ll end up measuring what’s important to you. Metrics should be built upon supplier performance expectations that support your company’s goals and strategies. You should be asking why you need a particular metrics and what are you going to do with the information once you have it. Metrics borrowed from others have several potential downsides:
- The data on which these metrics are based may not be available
- They may not relate to your supplier performance management goals.
- They may not be actionable
Rather than benchmark the KPIs in the supplier scorecards of others, you should benchmark their supplier performance management business process. The real best practice around metrics or KPIs (key performance indicators) is the robustness of the performance management business process and the results you get, not which individual metrics you collect.
That being said, if you want some ideas, not recommendations, for supplier performance metrics, here are a few sources:
- J.Ross Publishing (publisher) has WAV (Web Added Value) information available (registration required). You can sign up to get some supplier scorecard and metrics examples there that are associated with my book.
- Elsmar Cove, a quality discussion forum, has numerous examples of supplier scorecards (registration required).
- Balanced Scorecard – a brief article in Wikipedia that gives examples of metrics (or go to the Balanced Scorecard Institute website).
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