Best Practices – A Closer Look at Supplier Scorecards

The Supplier Scorecard assesses suppliers based on major performance benchmarks in several key areas such as Manufacturing Critical-path Time (MCT), On-time Delivery, Quality Parts per Million, Cost of Poor Quality, Inventory Turns and Productivity Gains.
Supplier Scorecards are one of the best techniques in using facts to rank the supplier’s relative performance within the supply base and tracking improvement in supplier’s quality over time. Scorecards also provide a data point into any future business negotiations. Following are the key operational metrics that leading manufacturers track in their supplier scorecard:
PPM of Supplier Components
# of Corrective Actions Last Quarter
Average Response and Resolution time for Corrective actions
# RMAs Processed per month
MRB Inventory Levels
# of Rework Hours due to Supplier Components
% of Actual COPQ Recovered from Suppliers
# of Customer Complaints on Product Quality
Warranty Reserves
Relative ranking of supplier
Performance against benchmark