Supplier Scorecard Sustainability

A question that often comes up is: What about using Excel to create supplier scorecards? It has always amazed me how much people depend upon Excel spreadsheets, even though most have information technology (IT) systems. I remember in my days working in manufacturing that an entire computer hardware manufacturing operation seemed to run on spreadsheets apart from the resident MRP system. I was part of the movement, with my own set of spreadsheets. Spreadsheets meant fast calculations, easy modifications, and total control. That is, each person had total control over his or her own data, and no one had to wait for the IT department to create reports or develop new software capabilities. I called it running manufacturing by spreadsheet technology. The main downside, of course, was that none of these spreadsheet silos talked to each other. And assumptions and data sources were totally up to each individual. Getting your data locally and try to think globally with it had its limitations. Plus, there was the sustainability problem of continual updating and maintenance of all of these spreadsheets.

IT has come a long way since those days. But silo thinking and acting still remains. And people still love their spreadsheets and the control that they afford. No IT department required. Just do it.

When it comes to supplier scorecards, Excel spreadsheets are widely used. Spreadsheets can be created quickly, cheaply and easily. However, here are some of the downsides:

  1. Data needs to be captured or created on a regular basis and input into the scorecards
  2. Typically, a human being has to do the work. Unless automated feeds exist, scorecards are a manual undertaking
  3. Humans have been known to get busy with other tasks and not always diligent about updating the scorecards. Thus, scorecards get issued late and lose their timeliness and urgency for taking action.
  4. Scorecard spreadsheets can end up being stored locally on one computer, where only their creator has access.
  5. People change jobs and no one takes over manually updating the spreadsheets
  6. Suppliers may question the source and accuracy of data in manually-produced spreadsheets

Using spreadsheets to generate supplier scorecards is attractive because it’s relatively inexpensive and gives people an easy and affordable way to get started measuring supplier performance.  But, in my experience, this approach is usually not sustained. Any manual, time-consuming step is in danger of falling by the wayside. For long-term sustainability, approaches that do not depend on particular individuals and that are systematic and automatic (such as SPM and scorecard software packages) have a better chance of supporting supplier scorecard sustainability and outlasting the individuals who toil to update spreadsheets.

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