Supplier
Rating
Elements
that are used to choose and retain suppliers should be weighed and rated by
their percentage of importance to the organization when rating supplier
performance. Usual fundamentals in choosing suppliers are cost, delivery,
flexibility, capabilities, quality, and service. These can be further broken
down.
For
example; Cost can be broken down into actual price and competitive pricing.
Delivery can be broken down into physical distance, reliability, speed, and
expediting. Flexibility might entail such things as modifications, changes in
volume or mixture. Capabilities would cover such things as product specialty,
technology, and whether the supplier will share their technologies with the
customer. Quality denotes conformance to specifications, durability of the
product supplied and reliability that the product is able to be produced with
few, if any, down-times. Service may involve such things as complaint handling,
information sharing, and other communication based elements that would make the
customer more at ease using the supplier.
Each
of these elements should be rated as a matter of importance to the customer who
is. using the supplier and given a percentile weight in the over-all System.
Every supplier, or at least similar supplier should be rated on the same scale.
There may be a few exceptions or differences in weighting of a supplier, but
once established, each supplier should be rated on a like scale.
Non-conforming
product should be taken into account and used when reviewing each supplier
score. Scores should be provided by a team that consists of (at least) Quality,
Purchasing, Engineering, Management, and a representative from any department that
is affected by the supplier. The ratings are tallies as “fuzzy” data and converted
statistically into a numerical score that is repeatable, understandable, and realistic.
Scores
are communicated to the suppliers with a brief analysis so that they may more clearly
understand customer needs and whether they are meeting them. Supplier Performance
Measurement (SPM) is used to both convert the fuzzy data to concrete data: “defuzzification”
(Maheswari & Kumari, 2012), and to rate suppliers on an approved supplier list.
Reference:
A. U.
Maheswari & P. Kumari, (2012), A fuzzy Mathematical Model for Multi Criteria
Group Decision Making –An Application
in Supply Chain Management. International Journal of Computer Applications 0975-8887,
Volume 54, No.7.
