Supply Evaluation - An Duong Quynh (1401518)

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Supply Evaluation - An Duong Quynh (1401518) by Mind Map: Supply Evaluation - An Duong Quynh (1401518)

1. Evaluation Methods/ Approaches (Reference: Lecture 5 - Evaluation Methods for Supplier, How to Measure, Nikko Kandelin, SAMK UAS)

1.1. Questionaires

1.1.1. Barriers (Reference: Website: , referred on 11/11/2016) Results reliability Gaining knowledge or research for  measurement areas Gathering appropriate and sound survey tools Difficulty in deploy Not always actionable Supplier compliance issues

1.1.2. RFI surveys Performance metrics via phone, mail or internet Concerning prospective suppliers

1.1.3. Quality surveys Gather information from suppliers Planning systems Planning processes Third party certification (ISO Certifications) Corrective action Tooling Test equipment Cost of quality Quality results

1.1.4. Supplier surveys Gather information about suppliers Confidence Capabilities Cultural background Compliance or motivation Competitiveness in market Experiences

1.2. Scorecards

1.2.1. Barriers (Reference: Website: , referred on 11/11/2016) Data integrity Dispute suppliers Resources requirement Not clearly applicable Unknown causes

1.2.2. Collecting supplier performance information with display of many performance elements on a same page

1.3. Site visits

1.3.1. Barriers (Reference: Website: , referred on 11/11/2016) Resource intensive Possible training process Site visit tools and expertise knowledge Inconsitency Hard to scale the process

1.3.2. Applicable to critical or strategic suppliers, suppliers have high levels of spend, sole-source with high switching cost suppliers

1.4. Third-party standards certification

1.4.1. Barriers (Reference: Website: , referred on 11/11/2016) Unwarranted best practices Outdated standards Focus on documenting procedures Complicated and strong focus on administrative tasks Unspecific to customer requirements General terms

1.5. Supplier evaluation software

1.5.1. Barriers (Reference: Website: , referred on 11/11/2016) Related funds outlay Resistance to changes

1.6. Supplier assessment

1.6.1. Objectives Product level Improving suppliers' product quality Company level Consideration about financial aspects Process level Investigate suppliers' production process Quality assurance system level Subjective investigation from customers about suppliers' quality organization

1.6.2. Methods Subjective Personal evaluation Objective Quantify suppliers' performances

1.6.3. Techniques and tools Spreadsheets Compare and evaluate quotation offered by suppliers Qualitative assessment Applicable for existed suppliers Vendor rating Quantitative data Supplier audit Cost modeling Estimates or results that concern cost discussion with suppliers

2. Goals of Supplier Evaluation

2.1. Risk Analysis (Reference: Lecture 2 - Risk Management, Nikko Kandelin, SAMK UAS)

2.1.1. Procurement Risks Transaction Cost Theory Relationship related immaterial and fixed asset Market risks Knowledge leaking risks Schedule related risks Shortage  of availability Cut in Production Wrong demand forecasts Competitiveness Warehouse problems Controlling prices Market entry Suppliers competition Company's own ability or credit-ability on the market Schedule and inventory FIFO? LIFO? Forecasts and sales plan Expertise availability Effectiveness Product's quality Reliable material supplies Limitation of supplier opportunitism Lack of supplier's room for improvement Configuration risks

2.1.2. Product Risks Critical Goods availability Product or supplier report system Lead times Purchasing decisions Key component Determine the end products costs Product structure Strategic Increase the end products added value Customers' appreciation of the attribution Competitive advantage point Close connection or co-ordination with Sales/ Marketing Department Technical Co-ordination with R&D Department Decisions of product approval, product design or limited production

2.1.3. Process Handling Risks Risk identification Risk evaluation Potential solution Actions/ Decisions Deciding level of security

2.2. Increase performance visibility (Reference: Website, , referred on 11/11/2016)

2.2.1. Proof of supplier performance

2.2.2. Enhance relationship between suppliers and company

2.3. Be aware of hidden waste and costs in the supply chain (Reference: Website, , referred on 11/11/2016)

2.3.1. Better aware of operation practices

2.3.2. Improve communication channel between company and suppliers

2.3.3. Reduce unnecessary wastes and costs

2.3.4. Review material management practices and purchasing decisions

2.4. Leverage supply base  (Reference: Website, , referred on 11/11/2016)

2.4.1. Better plan the development of company's products and services

2.4.2. Gain customers' added value

2.5. Align customer and supplier business practices --> Win-Win Situation (Reference: Website, , referred on 11/11/2016)

2.5.1. Sharing same business ethics

2.5.2. Similar interests on excellent standards

2.5.3. Same commitment for continuous improvement

3. Evaluation Strategy (Reference: Lecture 3 - Evaluation Strategy, Nikko Kandelin, SAMK UAS)

3.1. Supply base segmentation

3.1.1. Categorizing suppliers Strategic suppliers Important opponents for performance evaluation Sharing expertise knowledge above contractual expectations Proactively managing costs Leverage suppliers Influence business financial situation Bottle-neck suppliers Important opponents for monitoring evaluation Non critical or commodity suppliers Requiring least attention except for efficient operation Matrix mix analysis Supplier commitment matrix Supplier characterization matrix for product development Supplier characterization matrix for spend

3.1.2. Allocate company's resource to better manage suppliers

3.1.3. Critical decision of necessary supplier measurement and level of measurement

3.2. Actions toward different segments: Different matrix for actions and performance

3.2.1. Collaborative

3.2.2. Strategic

3.2.3. Commodity

3.2.4. Custom

4. Criteria for Evaluation (Reference: Lecture 4 - Evaluation Criteria, What to Measure, Nikko Kandelin, SAMK UAS)

4.1. Lagging and leading indicators

4.1.1. Predict or estimate the bottom - line performance results

4.1.2. Indicate value attributes

4.1.3. relevant to company's goal, strategies and performance expectations

4.1.4. Comprehensive management systems

4.2. Objective and subjective indicatiors

4.2.1. Quantitative measures Empirical performance Transfer costs Scrap value Lead times

4.2.2. Qualitative measures Personal perception Customer satisfaction Business practices

4.3. Performance expectations

4.3.1. Procurement strategy Corporate goals Improve customer satisfaction Corporate strategy Six Sigma tools to discover roots of customers complaints Procurement strategy Improve suppliers' performances Supplier performance expectation Critical consideration course of actions to take place in time

4.3.2. Decide supplier evaluation criteria Sourcing allocation Quality Lean organization

4.3.3. Theoretical business models Business practices, processes and performances Lean enterprise measurement ISO certifications

4.3.4. Value stream mapping Lean management method Applicable for current or future states Identify suppliers' influences on company and customers Aware of activities added value to customers and thus prevent waste

4.3.5. Business drivers Areas of cost, quality, time and technology/ innovation Influence and link supply chain management system to market place success strong impacts on company's performance

5. Evaluation Consideration (Reference: Website: , referred on 11/11/2016)

5.1. Develop robust and easy to deploy method to better evaluate suppliers

5.2. Consider the practical approach/ methodology

5.3. Gather and make good use of measurement data

5.3.1. Improve communication channel between supplier and company

5.3.2. Encourage supplier performance improvement

5.3.3. Coming up wit possible financial and competitive rewards for important/ key  suppliers