Supply managers and buyers have always had the challenge not just of finding suppliers but finding suppliers who are both high-performing and “best value”. Numerous supplier evaluation and supplier performance management software solutions are now available, where ten years ago very few options existed. Most options that I’m aware of are either SaaS (software [...]
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Companies have typically viewed suppliers as a source of cost that needs to be reduced, as supplier costs directly impact the bottom line. And it’s a given that procurement is always under pressure to fulfill the cost reduction mission. But in the process of viewing suppliers as big dollar signs that need to be [...] I was reading the recent blog post at the Spendmatters: Beyond Shedding the Deadweight in Procurement and Operations. Instead of just cutting headcount, particularly in procurement, Jason Busch suggests other ways to approach cost reduction. Among the suggestions are: driving better efficiency by fully using software solutions in the Procure-to-Pay cycle; using third [...] My previous post about why supplier scorecards fail generated a lot of interest. So today I’m going to write about one of the biggest reasons for failed supplier scorecards: There is little or no action or follow through that results from the scorecards. Supply managers get so focused on the idea of having a [...] The failures at Peanut Corporation of America are tragedy in every way. This supplier failed to meet both regulatory and customer requirements. Its customers failed either to uncover or report the failures, and people died as a result. Now a healthy, everyday product is suspect, and faith in the U.S. food processing industry has [...] I was recently interviewed by Nick Zubko, Purchasing Editor at IndustryWeek magazine, for an article on supplier scorecards. The resulting article, “Who’s Keeping Score?”, summarizes the actions needed to ensure supplier scorecards that are meaningful and actionable and is available online and in the February 2009 issue. To summarize the key points, the article explains that companies need [...] As the saying goes, statistics can be made to prove anything – even the truth. Or, everything is vague to a degree you do not realize till you have tried to make it precise (Bertrand Russell). The customer sends the supplier its monthly scorecard. Wait, the calculations seem completely wrong. We did better than [...] 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 [...] In my last post, I listed 11 reasons why supplier scorecards fail. I’d like to write about the first reason – measuring what is easily measured instead of measuring what is meaningful or important. This assumes that you already know what is important for your company to measure, but that’s a future topic. Let’s look [...] |
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