Supplier_Performance_Evaluation_Presentation (1).pptx

Supplier Performance Evaluation
Comprehensive Overview with Real-
World Examples

1. Introduction
• Supplier performance evaluation (SPE) is a
structured process to assess and measure
supplier capabilities in delivering value.
• Key aspects:
• - Ensures quality and consistency
• - Enhances supply chain resilience
• - Promotes continuous improvement

2. Objectives of SPE
• - Ensure Consistency and Reliability
• - Risk Management
• - Cost Efficiency
• - Continuous Improvement
• - Supplier Development

3. Key Performance Indicators
(KPIs)
• a) Quality: defect rate, returns
• b) Delivery: on-time delivery, lead time
• c) Cost: competitiveness, TCO
• d) Responsiveness: support, adaptability
• e) Compliance: ethical and sustainability
metrics

Real-World Example: Quality
• Toyota evaluates parts suppliers based on
DPMO (Defects Per Million Opportunities).
• High defect rates result in penalties or
disqualification.

Real-World Example: Delivery
• Walmart uses OTIF (On-Time, In-Full) metric.
• Poor OTIF performance may result in delisting
suppliers.

4. Evaluation Methods
• - Scorecards
• - Supplier Audits
• - Feedback Surveys
• - 360-Degree Evaluation
• - Balanced Scorecard Approach

5. Evaluation Process
• 1. Define Evaluation Criteria
• 2. Gather Data
• 3. Rate Performance
• 4. Provide Feedback
• 5. Develop Action Plans
• 6. Monitor Progress

6. Challenges in SPE
• - Inaccurate data
• - Subjectivity in scoring
• - Supplier resistance
• - Regional and regulatory differences

7. Tools and Technologies
• - ERP Systems (SAP, Oracle)
• - SRM Software
• - BI Tools (Tableau, Power BI)
• - Automated Scorecards

8. Case Study: General Motors
• GM uses Global Supplier Quality Track.
• Suppliers are rated and may be placed on
probation if performance is low.

Case Study: Nestlé
• Uses Responsible Sourcing Audit Program.
• Focuses on labor, environment, and food
safety standards.

Case Study: Dell Technologies
• Uses Supplier Scorecard: innovation, delivery,
sustainability.
• High performers receive recognition and
strategic opportunities.

9. Benefits of SPE
• - Improved quality and service
• - Reduced risks
• - Strategic partnerships
• - Enhanced transparency
• - Continuous innovation

10. Conclusion
• Supplier evaluation is ongoing.
• Fosters collaboration, accountability, and long-
term value.

Supplier_Performance_Evaluation_Presentation (1).pptx

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