METALCRAFT SUPPLIER

SCORECARD CASE STUDY

STRATEGIC SOURCING
NAVEEN VENKATESH
GJAN14GLM23
AKHIL GUPTA

GJAN14GLM21

RONAK LAKHANI

GJAN14GLM25

PROBLEM STATEMENT & OBJECTIVES OF

THE PROJECT
Zero Defects sub-assemblies required from chosen supplier

Key Objectives:
Evaluate scorecard metrics and check if they are exhaustive
Evaluate the scorecard for fairness, accuracy and reliability
Trade off least defect PPM, low price and good technical
capability to find the best fit supplier
Investigate process improvement in supplier selections by means
of scorecard up gradation

ARE THE PURPOSE OF SUPPLIER

SCORECARD MEETING ITS OBJECTIVES
Purpose of the scorecard

Remarks

Information sharing across

multiple activities and with
suppliers

Yes, the purpose is being met

Aggregate supplier performance

and centralize

Consolidated and plant level data

available

Selection of supplier for any

requirement

It ignores some key attributes in the

process

Improve performance of
suppliers

44% improvement in quality

Improve responsiveness

Suppliers take more time to react

than before

To identify problems in advance

Yes this is being used by SD

Extensive usage as a tool

Many are not aware

STRENGTHS & WEAKNESSES OF

SCORECARD
Strengths

Weaknesses

Aggregation of data and

monitoring at corporate level

Awareness of scorecard was

not wide spread

Provided feedback to suppliers

on their performance

Pricing continued to play a

major role in the supplier
selection process

Provided a log of historical

performances for each supplier

Classification of data on the

basis of product lines etc. not
possible

Improve awareness about

performance

Suppliers became less

responsive

Input automated from CMMS

Manual intervention is
possible

Provides a rationale for

supplier selection

Some participants have more

command

Supplier selection based on

No assessment for

Source: Case

EXPLOITATION OF THE SCORECARD

Incentive
Final decision lies
with
Initiate QR in CMMS
Process ownership

Source: Case

Participa
nt
Buyer

Quality
Buyer

Influence
They could ignore other
aspects in favour of price
reduction
They alter the PPM goals with
personal bias
With higher level approvals
under performing suppliers
can be chosen

SCORECARD IMPROVEMENT
Area of Concern

Ignores pricing & Technological

Recommendations

capability

Count of defects over a period

forecast

doesnt give information on repeat

offenders

Payment terms on Purchase orders

should be considered as an input

Feedback of SD engineer should

also be incorporated in the process

Weights for calculating

the process

performance figure to be varied as

Standardized weight allocation for

per product category

any kind of product or project

Supplier development are most

frequent users, but have no say in

MTBF could be incorporated in the

evaluation process

Suppliers are held responsible for

activities that they arent liable for

Include ranks through judgmental

Suppliers became less responsive

Provide progressive feedback and

estimated performance figure to

MANAGERIAL PROCESS IMPROVEMENT

Area of Concern

Warranty cost are more than profit

Recommendations

Vendor place inspection or third

party inspection to be carried out

The selection process doesnt

encompass end user/customer

(QR process)

requirement

Finished goods quality rating and

customer feedback should be used

After sales service is not

Evaluate Total cost of ownership

considered

Multi-functional program

Supplier development are most

management team should finalize

frequent users, but have no say in

decision

the process

Promise incentives to suppliers who

Suppliers became less responsive

improved and moved from Red to

as once disregarded orders hardly

Green

ANY QUESTIONS?