Overview

This article will guide you through the process of creating and using Supplier Scorecards in iVendNext, highlighting key features such as scoring setup, criteria setup, and evaluation formulas.

Step-by-Step Guide to Creating a Supplier Scorecard

Supplier performance is a critical factor in the success of any procurement process. To help organizations evaluate and manage their suppliers effectively, iVendNext offers the Supplier Scorecard feature. A Supplier Scorecard is an evaluation tool that tracks supplier performance over time, focusing on key metrics such as item quality, delivery timeliness, and responsiveness.

The steps to create a Supplier Scorecard are explained below:

1. Navigating to the Supplier Scorecard

To create a Supplier Scorecard, follow these steps:

1. Go to the Home Dashboard: Log in to your iVendNext account and navigate to the Home dashboard.

2. Select the Buying Module: From the Home dashboard, click on the Buying module.

3. Locate Supplier Scorecard: Under the Supplier Scorecard section, click on the Supplier Scorecard shortcut.

2. Creating a New Supplier Scorecard

Once you’ve accessed the Supplier Scorecard section, follow these steps to create a new scorecard:

1. Click on New: In the Supplier Scorecard list, click on the New button.

2. Select a Supplier: Choose the supplier you want to evaluate from the dropdown list.

3. Set the Evaluation Period: Select the evaluation period (weekly, monthly, or yearly) for the scorecard.

4. Configure Scoring Setup: Define the scoring function and criteria (details in the next section).

Key Features of Supplier Scorecards

Some of the key features of a Supplier Scorecard are summarized below:

1. Scoring Setup

The Supplier Scorecard allows you to evaluate supplier performance over a set period, which can be weekly, monthly, or yearly. The score is calculated based on the weighting function, which is customizable. By default, the score is linearly weighted over the previous 12 scoring periods.

Supplier Standings

Supplier standings are used to quickly sort suppliers based on their performance. These standings are customizable and can be used to restrict suppliers from being included in Request for Quotations (RFQs) or Purchase Orders (POs) if their performance falls below a certain threshold.

2. Criteria Setup

A supplier can be evaluated on several individual criteria, such as:

• Quotation Response Time: How quickly the supplier responds to quotation requests.

• Delivered Item Quality: The percentage of items accepted vs. rejected.

• Delivery Timeliness: The percentage of on-time deliveries.

To create a new criterion, go to Buying > Supplier Scorecard > Supplier Scorecard Criteria. Each criterion is assigned a weight, and the total weight of all criteria should add up to 100.

3. Supplier Scorecard Variables

The criteria formula uses pre-established variables to evaluate supplier performance. Examples of variables include:

• Total Number of Items Received: The total number of items received from the supplier.

• Total Number of Accepted Items: The number of items accepted from the supplier.

• Total Number of Rejected Items: The number of items rejected from the supplier.

These variables are used in the criteria formula to calculate the supplier’s score. Additional variables can be added through server-side customizations.

4. Evaluation Formulas

The evaluation formula uses mathematical functions to calculate the supplier’s score. Common functions include:

• Addition (+)

• Subtraction (-)

• Multiplication (*)

• Division (/)

• Min/Max Functions: min(x,y), max(x,y)

• If/Else Statements: (x) if (formula) else (y)

For example, the formula for calculating the acceptance rate of items would be:

{total_accepted_items} / {total_received_items} if {total_received_items} > 0 else 1

This formula ensures that the score is calculated correctly, even if no items were received in a given period.

How to Use Supplier Scorecards for Effective Supplier Management?

You can use Supplier Scorecards for effective supplier management.

1. Regularly Generate Scorecard Periods

To keep the scorecard up-to-date, regularly generate missing scorecard periods by clicking the Generate Missing Scorecard Periods button. This ensures that the supplier’s current score reflects their most recent performance.

2. Monitor Supplier Performance Over Time

The Supplier Scorecard provides a visual graphic showing the supplier’s performance over time. Use this to identify trends, such as improving or declining performance, and take appropriate actions.

3. Take Action Based on Scores

Use the supplier’s score to make informed decisions, such as:

• Awarding Contracts: Prefer suppliers with higher scores for future contracts.

• Issuing Warnings: Notify suppliers with declining performance and work with them to improve.

• Restricting RFQs/POs: Restrict suppliers with consistently low scores from being included in RFQs or POs.

Pro Tip: Regularly review and update your Supplier Scorecards to ensure they reflect the most current data. This will help you identify trends and take proactive steps to improve supplier performance.