Improving Supplier Performance 2 – Crafting KPIs (VIRTUAL)
Round table session held on 29th October 2020
About this session
As we set about managing the economic consequences of the pandemic, suppliers will inevitably be asked to do more.
Not just deliver more, improve quality and reduce price, but also ensure safety, guarantee compliance & manage supply chains.
Increasing supplier performance across a wider range of factors demands more intricate agreements and better definitions of success; in terms of service level agreements (SLAs) and agreed key performance indicators (KPIs)
These twin sessions covering firstly SLAs and secondly KPIs leverage off the recent discussions at PASA CONNECT about SRM’s enhanced role through the crisis, as well as the issue of supplier performance management (SPM) – these sessions are available through the PASA CONNECT archive in the Member Resource Centre.
Crafting KPI pyramids, sometimes directly within the SLA, can focus suppliers and their team on the key quantifiable outcomes of their role that make a difference to your core business.
Effectively, building a more numeric picture of the contract agreement, forging a scorecard against which to examine performance and results -v- the original plan.
Any KPI pyramid is also a cohesive structure which cumulatively brings overall supplier performance up, through; knowing what exactly to measure, defining data sources up front, applying SMART theory, planning KPI Metric Flow, using Common Performance Metrics and incorporating the principles of both risk management and incentivisation.
Ben Shute FCIPS is the managing director of Comprara, a leading Australian procurement solutions provider who deliver services, tools, training and technologies to organisations, and is headquartered in Melbourne.