The Procurement Glossary » Supplier Performance Management

Supplier Performance Management

Suppliers & Vendors

Definition

The ongoing measurement of how well suppliers meet expectations on quality, delivery, cost and service.

Explanation

Performance management uses metrics and scorecards to make supplier behaviour visible and drive improvement. It underpins renewal and award decisions and turns vague dissatisfaction into specific, addressable issues.

Example

Monthly delivery, defect and responsiveness metrics feed each supplier's performance scorecard.

Related terms

• Supplier Scorecard — A structured summary rating a supplier across key metrics to track and compare performance over time.
• Key Performance Indicator (KPI) — A metric chosen to track progress toward a specific objective.
• On-Time In-Full (OTIF) — A delivery metric measuring the share of orders delivered both on the promised date and in the complete quantity.
• Supplier Management — The discipline of selecting, onboarding, evaluating and developing suppliers to maximise value and minimise risk over time.

Related concepts

• Supplier Management — Onboarding, qualifying, evaluating and governing the suppliers a business relies on — turning a scattered vendor list into a managed supply base.

Frequently Asked Questions

What is Supplier Performance Management?

The ongoing measurement of how well suppliers meet expectations on quality, delivery, cost and service. Performance management uses metrics and scorecards to make supplier behaviour visible and drive improvement. It underpins renewal and award decisions and turns vague dissatisfaction into specific, addressable issues.

Can you give an example of Supplier Performance Management?

Monthly delivery, defect and responsiveness metrics feed each supplier's performance scorecard.

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