At a conference this month, General Motors VP of Global Vehicle Engineering Mark Reuss stressed the importance of developing and maintaining good relationships with suppliers. According to an article on ReliablePlant.com,

According to the 14th Annual Third-Party Logistics Study, which was conducted by Capgemini Consulting, both shippers and 3PLs are reporting that their current IT provider is not giving them the tools they need to measure performance:

According to the 14th Annual Third-Party Logistics Study, which was conducted by Capgemini Consulting, both shippers and 3PLs are reporting that their current IT provider is not giving them the tools they need to measure performance:

For companies who source from many different places, it is vital to company operations (especially the supply chain) that suppliers are all performing according to a certain standard. The larger the company is, and the more suppliers there are, the more difficult it can become to ensure top performances by everyone. This is where the use of supplier scorecards can come in very handy. ADT Security Services (a unit of Tyco) seems to have this down to a science. Using a 100-point system, the sourcing team at ADT rates strategic suppliers quarterly on criteria such as quality, delivery and cost, which encourages continuous improvement in supplier performance.

One technique to measure and improve upon supplier performance is the use of supplier scorecards. If used properly, scorecards can help companies to reduce vendor lead times, improve inventory management, maximize sell-through and reduce costs, and ultimately result in an improved bottom line and cash flow. Check out these tips from Supply Chain Management Review on designing and utilizing scorecards to improve performance: Unlocking Value through the Supplier Scorecard.

In this article from International Freighting Weekly, Nathan Pieri from Management Dynamics discusses some of the benefits shippers can realize by implementing a performance management software solution.

According to a study released by UK supply chain consulting firm State of Flux earlier this month, many companies are failing to see a destinction between supplier performance and supplier relationships. Out of 223 procurement, supply chain, and supplier relationship managers surveyed, 62% said that they did not have an accepted definition of supplier relationship management at their company. To set the record straight, according to State of Flux supplier performance management (SPM) is about how well suppliers are doing what they initially said they would do in a contract. Supplier relationship management (SRM) refers to a collaborative, two-way relationship that can deliver value to both parties.