Do you benchmark suppliers?
|A.||We just stick with the suppliers we have.|
|B.||We know it’s a good idea, but we don’t know how to benchmark alternative suppliers.|
|C.||We have piecemeal information to partially benchmark alternative suppliers.|
|D.||We benchmarked alternative suppliers on price, quality and service levels in the past year.|
|E.||We maintain accurate current information to benchmark alternative suppliers on price, quality, availability, selection, reliability, functionality, relationship and service levels.|
|[Score: A=0, B=1, C=2, D=3 and E=4]|
Why is this question important?
A benchmark is defined as “something that serves as a standard by which others may be measured.”
The first step in the benchmark development process is to design the benchmark audit document which is nothing more than an in-depth questionnaire which allows you to gather information on suppliers to compare them on:
- Service levels
Other areas should be added which are appropriate and important to your business.
A simple benchmark process might comprise the completion of the following grid.
To take an example – Quality Assurance – questions could include:
- Does the supplier have a documented quality system in place?
- Is a copy of their Quality Assurance manual available for you to review?
- Is there a continuous quality improvement plan in place?
- Does the supplier set annual quality target objectives with transparent measurements?
- Does the supplier have a QA department and do they have the requisite authority to stop material at receiving, inspection, production and or final shipping?