What gets tracked by a Supplier Scorecard? | DCR Workforce Blog

What gets tracked by a Supplier Scorecard?

Planning a Scorecard:

Before we spend hours agonizing over the format that a scorecard needs to have and the components of a scorecard that contain parameters that must be tracked,  we must have clear insight into what data needs to be tracked and how it reflects upon the state of affairs.  CW managers are comfortable using scorecard presented in a simple spread sheets or through sophisticated embedded software in an ERP or as a table in a Word document! What really matters is the insight the data is supposed to provide.

It is also important for the CW manager to take personal interest in specifying the parameters for measuring the supplier performance, based upon the strategic direction set by the organizational goals. To illustrate the need, assume a company has a strong affirmative action policy and a strong agenda to fill at least x% of roles to meet that particular goal, a supplier card which does not track that parameter would fail to serve any real purpose.

While keeping it as simple and intuitive to understand as possible, involving all internal stakeholders and some external stakeholders would go a long way to making

Standard Parameters:

Having said that customization is important, we are now free to go on with specifying some of the parameters that could be incorporated in a supplier scorecard.

  • All contractual & service level agreement criteria  from the RFP/RFQ process of supplier selection (like number of conversions – though job openings, submissions per job, short listed, moved to interview, resulted in an offer and accepted  – and time to fill, cost per head and source per hire etc.)
  • Compliance with processes
  • Pricing – and markups per type of service
  • Vendor’s transaction record
  • Purchase orders
  • Invoices and submissions
  • Responsiveness to any challenge in staffing issues
  • Benefits offered to the Contingent Workers
  • Use of online processes

Managing the Outcome:

Some of the data may not be comprehensive or complete, and may possibly prove unobtainable, without a huge investment of time and money. This is especially true when tracking payback time of training, new hires and replacement hires and intangible attributes like quality, efficiency and satisfaction.

Another point to be noted is that a supplier scorecard evaluates the performance of a supplier within the offered capabilities. Some suppliers are niche players and offer their best in a small sphere. Such suppliers cannot be compared on their breadth or range with other suppliers or penalized in any manner for being small or being restricted to a niche. They need to be judged within the parameters of their chosen sphere. In any case, another supplier can step in for needs which cannot be met by the niche player; it is not as if a single supplier is expected to serve all the needs of an MSP.

After the evaluation, the suppliers could still be kept motivated and pushed to higher levels of effort and commitment through the manner which the results are conveyed and the rewards (which may be non-financial like a certificate or a plaque) for the supplier who has managed to post better results than everyone else.

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.