Implementing Supplier Performance Management

This chapter covers the following topics:

• Overview of Supplier Performance Management
• Implementing Supplier Performance Management

Overview of Supplier Performance Management

Organizations are constantly seeking high performance from their suppliers so they can source a bigger fraction of their requirements from cost effective, responsive, well performing suppliers while reducing business with under-performers or retiring them completely. Supplier Lifecycle management lets you evaluate supplier performance and gather key performance metrics such as supplier responsiveness, technical performance, quality control performance, and cost performance. Supplier Performance Evaluation is an internal process, where you invite experts within various departments to provide evaluation of suppliers that they deal with.

Supplier Compliance and Profile Audit user flow

S. No.	Supplier Management Administrator Actions	Evaluator Actions	Comments
1	Creates RFI with predefined negotiation style “Supplier Performance Evaluation” Adds internal requirements to gather supplier performance evaluations from internal users Optionally associates scores with internal requirements Maps requirements, section scores and total scores to UDAs in the supplier's profile Adds existing suppliers to RFI. This does not notify the supplier, but informs evaluators which suppliers to evaluate Creates evaluation team with members from various departments to assign the task of evaluation Publishes RFI		Evaluation team is notified
2		Logs in and creates response to the RFI Submits response	Automatic scoring set up for each requirement is applied
3	Reviews evaluator responses and close the RFI.		Supplier Management Administrator can View all supplier internal evaluator responses. View automatic scores
4	Optionally, provide score for any requirements setup with manual scoring.
5	Select Manage Scoring Teams in the Action dropdown. Click Lock Scoring to close further analysis and evaluation.		Lock scoring action calculates the overall score for supplier(s) in the RFI.
6	Completes the RFI		On Complete, mapped responses and scores are synchronized with profile attributes based on RFI mappings. Evaluation responses and scores can be hidden from suppliers. See Step 6: Setting up Profile Access in Setting up Supplier Profile.
7	Searches Supplier Profile for gathered information using basic or advanced Search		Advanced search is an easy way of finding supplier information

All evaluation RFIs are also saved in the supplier master and are accessible to the authorized internal users from the Supplier's profile for reference.

Implementing Supplier Performance Management

Supplier Management Administrator can set up a Supplier Performance Evaluation RFI Template, or Reusable Requirements List or Reusable Attributes List, to be reused in RFI documents for periodic evaluations. Steps required to set up the RFI Template, Reusable Requirements List and Reusable Attributes List are the same as explained in Implementing Supplier Registration and Qualification Management chapter. However, it is important to highlight the differences:

• RFI Template is mandatory in case of the registration flow, whereas it is optional in case of Supplier Performance Management. A Supplier Management User may directly create a RFI without any template.

• The RFI is internal and therefore the added suppliers in the RFI are neither notified nor can access this RFI. Suppliers are added only to indicate to evaluation team members which suppliers they must evaluate.

• Responses are synchronized with supplier profile as soon as the RFI is completed. There is no need for approval of suppliers.

Another important aspect to note is the difference in the predefined Negotiation style. If you customize the Negotiation Style for Supplier Performance Evaluation, then make sure that you understand the impact of each control.

Leverage Supplier master data and user defined profile attributes metadata to create custom OBIA reports for supplier performance management. You can also leverage the new OA personalization capability to create an OBIEE rich container region to display OBIA supplier performance reports from within Oracle E-Business Suite Supplier Management application pages.

Example - Mapping multi-row UDAs with RFI Requirements section values and total score

Consider the following requirements set up to gather internal evaluations:

Requirements for supplier performance evaluation

Only sections are shown, but assume that each section also contains requirements.

A multi-row supplier profile UDA is set up to capture evaluator responses:

Attribute Group	Attributes (Data Type)	Business Entity	Associated with
Supplier Performance Evaluation	RFI Number (Number) Evaluation Date (Date) Evaluator (Char) Supplier Performance Score (Number) Price Performance Score (Number) Price Performance (Text) Delivery Performance Score (Number) Delivery Performance (Text) Quality Performance Score (Number) Quality Performance (Text) Technical Performance Score (Number) Technical Performance (Text) Management Performance Score (Number) Management Performance (Text) Responsiveness Performance Score (Number) Responsiveness Performance (Text) Overall Supplier Performance (Char)	Supplier Party	Common

To map requirements to the multi-row UDA, define header level mappings. Header level mappings provide a unique identifier to each row of the UDA. Also, map each requirement to an attribute.

Header

RFx	Supplier Profile Data Level	Supplier Profile Association level	Supplier Profile Attribute Group	Supplier Profile Attribute
RFI Number	Supplier Party	Common	Supplier Performance Evaluation	RFI Number
Evaluator Name	Supplier Party	Common	Supplier Performance Evaluation	Evaluator
Evaluation Date	Supplier Party	Common	Supplier Performance Evaluation	Evaluation Date

To save section scores and total score:

RFx Section Scores	Supplier Profile Data Level	Supplier Profile Association level	Supplier Profile Attribute Group	Supplier Profile Attribute
Total Score	Supplier Party	Common	Supplier Performance Evaluation	Supplier Performance Score
Supplier Responsiveness	Supplier Party	Common	Supplier Performance Evaluation	Responsiveness Performance Score
Quality Performance	Supplier Party	Common	Supplier Performance Evaluation	Quality Performance Score
Schedule/Delivery Performance	Supplier Party	Common	Supplier Performance Evaluation	Delivery Performance Score
Technical Performance	Supplier Party	Common	Supplier Performance Evaluation	Technical Performance Score
Price-Cost Performance	Supplier Party	Common	Supplier Performance Evaluation	Price Performance Score
Relationship Management	Supplier Party	Common	Supplier Performance Evaluation	Management Performance Score

Requirements

RFx Section	RFx Requirement	RFx Response	Supplier Profile Data Level	Supplier Profile Association level	Supplier Profile Attribute Group	Supplier Profile Attribute
Supplier Responsiveness	How is the overall supplier responsiveness?	Value	Supplier Party	Common	Supplier Performance Evaluation	Responsiveness Performance
Quality Performance	Overall, how do you rate this supplier on their quality performance?	Value	Supplier Party	Common	Supplier Performance Evaluation	Quality Performance
Schedule/ Delivery Performance	Overall, how do you rate this supplier on schedule and delivery?	Value	Supplier Party	Common	Supplier Performance Evaluation	Delivery Performance
Technical Performance	Overall, how do you rate the Technical capability of this supplier?	Value	Supplier Party	Common	Supplier Performance Evaluation	Technical Performance
Price-Cost Performance	Overall, how do you rate this supplier on their price and cost performance?	Value	Supplier Party	Common	Supplier Performance Evaluation	Price Performance
Relationship Management	Overall, how do you rate the management quality of this supplier?	Value	Supplier Party	Common	Supplier Performance Evaluation	Management Performance
Overall Supplier Performance	How do you rate the overall performance of this supplier?	Value	Supplier Party	Common	Supplier Performance Evaluation	Overall Performance

On completing the RFI, the application synchronizes evaluator responses with the associated supplier profile UDA.

Supplier Profile showing Performance Evaluation UDA