What makes a Supplier Scorecard fail? | DCR Workforce Blog

What makes a Supplier Scorecard fail?

Ever since the concept of balanced scorecards was introduced to measure performance indicators using four different perspectives – customer, internal business, innovation & learning, and financial – managers have been trying very hard, through tracking such indicators through different types of scorecards and dashboards, to get a handle on the underlying success factors that could lead to sustainable quality of performance and assured success.

By this definition, it will have to be accepted that any scorecard which fails to contribute directly and tangibly to a better performance can be considered a failure, mainly because all the resources, effort and time invested were totally wasted in the absence of it.

What could make a Scorecard fail?

Any dissatisfaction with supplier scorecards could result out of the following:

  •  Ill conceived scorecard which gathers data without any method or direction conceived for its use may give an entirely undependable output.
  • Pilot-testing a scorecard helps to weed out many issues, including possibly aggressive reactions from the suppliers against any erroneous scoring methods being used – leading to a lot of protestations and some bad blood which would impact performance only negatively.
  • The data collection for the scorecard becomes an additional burden the individuals involved in the process and the load of work is completed as a last-minute exercise with grudging discontent.
  • Manual keying in of data by unwilling hands could ruin data integrity and subjective approach of questions requiring judgmental answers could lead to thoroughly surprising outcomes.
  • The same cut-off date is sometimes not applied to the data inputs.
  • No inputs are obtained from internal customers and they remain voiceless and faceless through the entire exercise.
  • Data is averaged or tweaked so much that the picture presented is not credible anymore.
  • The data submitted by MSPs on behalf for the suppliers linked to them may or may not provide an entirely accurate picture, especially if the MSP’s performance scores are linked to their supplier’s performance, creating a conflict of interest and incentive to misrepresent the information.
  • Suppliers could differ in many ways and still provide valuable services in their specific niche. If the scorecard misses this fact and treats every supplier as equal, the results could come out thoroughly skewed.
  • If the scorecard fails to align the scoring weights to results which directly relate to the business strategy of the organization, the results would just waste every second and dime spent on putting it in place.

As reiterated repeatedly, a scorecard needs to be customized to the goals of the organization and its specific performance requirements from its suppliers in such a way as to understand where the scope for improvement lies in managing its relationship with supplier.

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.