PurchaseNegotiationTexasAamp;MUniversity采购谈判德克萨斯am课件.ppt

1、1Chapter 8Supplier Evaluation and SelectionIDIS 424Spring 2004.2Supplier Evaluation and SelectionReliable:Measures are well understood by evaluatorsStraightforward:Easy to calculateObjective:Uses a quantitative scoring systemFlexible:Can be used with different purchase categoriesComprehensive:Consid

2、ers important categories or criteriaEffective SupplierAudit Characteristics.3The Sourcing ProcessSupplier Evaluation andSelectionSupplierManagementSupplierDevelopmentWhat criteria and methods will we use to evaluate and select suppliers?What must we do to manage suppliers effectively and efficiently

3、?What efforts should we put forth to improve supplier performance?.4Supplier Evaluation and Selection nDiscussion Question:What is a process?nWhy is is critical to view supplier evaluation and selection as a process?.5Supplier Evaluation and Selection nSupplier evaluation and selection is one of the

4、 most important processes performed at industrial firmsnA well-defined and rigorous supplier selection process relates to which principles of total quality management?.6Supplier Evaluation and SelectionnSupplier evaluation and selection is an eight-step process composed of sub-processesWhew!This see

5、ms like hard work!Step 1:Recognize that a need exists to evaluate and select a supplierStep 2:Identify key purchasing/sourcing requirementsStep 3:Determine appropriate sourcing strategyStep 4:Identify potential supply sources Step 5:Limit suppliers in selection poolStep 6:Determine method of supplie

6、r evaluationStep 7:Make supplier selection decisionStep 8:Negotiate and execute agreement.7Supplier Evaluation and SelectionnStep 1:Recognize that a need exists to evaluate and select a suppliernDiscussion Question:How or when do we know that a need exists to evaluate and select a supplier?.8Supplie

7、r Evaluation and SelectionnStep 2:Identify key purchasing and sourcing requirementsnWhat are our internal requirements in quality?Cycle time?Cost?Technology?Responsiveness?Delivery?Design support?Other?nDiscussion Question:How do we know or determine these internal requirements?.9Supplier Evaluation

8、 and SelectionnStep 3:Determine purchasing or sourcing strategynNo single strategy will satisfy the requirements of every purchase requirementnFirms often develop strategies around commodities using a portfolio analysis approach(to be presented later).10Supplier Evaluation and SelectionnStep 3:Deter

9、mine purchasing or sourcing strategy(cont)nVarious purchasing strategy considerations exist-nSingle versus multiple suppliersnNumber of suppliers to maintain in the supply basenDomestic versus foreignnShort-term versus longer-term purchase contractsnFull-service suppliers versus non full-service sup

10、pliersnPotential collaborative relationships versus traditional relationshipnSources of power.11Supplier Evaluation and SelectionnStep 4:Identify potential supply sourcesnDiscussion Question:What are the various sources of information available when identifying supplier candidates?n n n n n n I cant

11、 believe how muchinformation is out there!.12Supplier Evaluation and SelectionnStep 5:Limit suppliers in selection poolnPurchasers often perform a first cut or preliminary evaluation of potential suppliers to narrow the list nTime and resources prohibit in-depth evaluation of all suppliersnMethods t

12、o reduce suppliers in the pool-nFinancial risk analysis(discussed later)nEvaluation of previous performancenEvaluation of supplier provided informationnWhat kind of information should we ask suppliers to provide?Sorry,but some suppliers aregoing to get the-.13Supplier Evaluation and SelectionnStep 6

13、:Determine method of supplier evaluationnMajor ways to evaluate suppliers:nFrom supplier-provided information(bids or product samples)nOn-site supplier visitsnUse of preferred supplier listsnCurrent supplier scorecardsnInternal customer surveysnCombination of above methods.14Supplier Evaluation and

14、SelectionnStep 6:Determine method of supplier evaluation(cont)nCross-functional teams often evaluate suppliers directly through on-site visitsnPossible areas to evaluate during a supplier visit-nCost structurenDelivery performance nQuality systems and performancenManagement capabilitynWorkforce capa

15、bilitynSupplier agility and flexibilitynSuppliers supply chain management capabilities.15Supplier Evaluation and SelectionnStep 6:Determine method of supplier evaluation(cont)nPossible areas to evaluate during a supplier visit(cont)-nProcess and technological capabilitynEnvironmental compliancenFina

16、ncial capability and stabilitynInformation systems capabilitynProduction scheduling and control systemsnLonger-term relationship potentialnSuppliers supply chain management capabilitiesnCapacitynOther?.16Supplier Evaluation and SelectionnStep 6:Determine method of supplier evaluation(cont)nDevelop a

17、nd conduct supplier auditsnFirms are increasingly willing to commit the resources to develop a supplier performance audit and then use that audit to evaluate suppliers directlyWhat resources are required to develop and administer an audit?.17Supplier Evaluation and SelectionnStep 6:Determine method

18、of supplier evaluation(cont)nSupplier audit development process(cont)1.Identify key supplier evaluation categories2.Weight each evaluation category3.Identify and weight subcategories4.Define scoring system5.Evaluate supplier directly6.Review evaluation results7.Make selection decision.18Supplier Eva

19、luation and SelectionnStep 7:Make supplier selection decisionnActivities associated with this step vary depending on the purchase requirementnRoutine items may simply require notifying the supplier and awarding a purchase contract or blanket orderAnd the selected supplier is.19Supplier Evaluation an

20、d SelectionnStep 7:Make supplier selection decision(cont)nOther selection issuesnSize relationshipnDistancenCompetitors as suppliersnCountertrade requirementsnCorporate social objectives.20Supplier Evaluation and SelectionnStep 8:Negotiate and execute agreementnMajor purchases may require a cross-fu

21、nctional team negotiating with the supplier to reach agreement about specific contract issuesnLoad contract into corporate systems.21Supply Base OptimizationnSupply base optimization or rationalization is the process of determining the right mix and number of suppliers to maintainnA continuous proce

22、ss that strives for the ideal number and mix of capable suppliersnOptimization does not only mean adding or reducing suppliers.It can mean switching suppliers,also nOptimization does not mean supply base reduction,although historically North American firms have too many tier one suppliers nAs compan

23、ies continue to rely on fewer total suppliers,the selection process takes on even greater importance.22Supply Base OptimizationnWhy is optimization critical?nThe costs associated with multiple suppliers for each purchased good or service usually outweigh any perceived reduction in supply risknOptimi

24、zation is a critical prerequisite to the development of a world-class supply basenSome leading-edge activities and strategies are simply not feasible with too large a supply base-nSupplier integrationnCollaborative agreementsnSupplier developmentnJoint total quality/cost reduction efforts.23Supply B

25、ase OptimizationnAdjustment activity over the last five years-n74%of firms surveyed decreased their total number of tier one suppliers nAverage reduction was in the 21%-30%rangen7%said the size of their supply base remained the samen19%increased the size of their supply basen Average increase was 10

26、%(Trent and Monczka 1998).24Supply Base OptimizationnAdjustment activity expected over the next several years-n84%of firms surveyed expect to decrease their total number of tier one suppliers nAverage reduction expected to be in the 21%-30%rangen7%expect the size of their supply base to remain the s

27、amen9%expect to increase the size of their supply basenAverage increase expected to be less than 10%(Trent and Monczka 1999).25Supply Base OptimizationnExpected benefits of an optimized supply base-nOpportunity to work with world-class suppliers,which leads to improved value-chain performancenLower

28、transactions costs-many suppliers creates overheadnLeverage leading to lower purchase costsnAbility to pursue value-added activitiesnReduced supply base risk(how can that be?).26Supply Base OptimizationnDiscussion Question:What are the potential risks of a reduced supply base?n n n n n n n Dazzle us

29、 with your answers!.27Supply Base OptimizationnFormal Approaches to Supply Base OptimizationnRequires an analysis to identify the 20%of suppliers receiving the majority of purchase dollarsnA firm can also identify the minority of suppliers causing the majority of problemsnThis approach often assumes

30、 the best suppliers receive the majority of purchase dollars-is this really the case?20/80ruleThese approaches adapted from Monczka,Trent,and Handfield,“Purchasing andSupply Chain Management,”and K.R.Bhote,“Strategic Supply Management”.28Supply Base OptimizationnFormal Approaches to Supply Base Opti

31、mizationnAll suppliers,regardless of history,have a chance to remain in the supply basenSuppliers have a specified period to meet stringent performance requirements in cost,quality,delivery,etc.nSuppliers who fall short may soon become ex-suppliersnSuppliers may perceive this approach as heavy hande

32、dImprove or Else Approach.29Supply Base OptimizationnFormal Approaches to Supply Base OptimizationnRequires careful evaluation of the performance record of each supplier to place suppliers into one of three categoriesnFirst category(and likely the largest)includes those suppliers incapable of meetin

33、g current or future performance requirementsnSecond category includes suppliers falling short but demonstrating performance potentialnThird category includes near-perfect suppliers requiring no improvement assistanceTriage Approach.30Supply Base OptimizationnFormal Approaches to Supply Base Optimiza

34、tion nRequires suppliers to pass a successive series of cuts to remain in the supply basenSuppliers must pass a series of hurdles similar to climbing a staircasenPurchaser defines the hurdles-possible areas include quality,delivery,technical capability,willingness to share information,supplier sizeC

35、ompetency Staircase Approach.31Supply Base OptimizationnSupply base optimization critical success factorsnTimenCross-functional teamsnA supplier measurement system and data warehousenA strategy development process that considers optimization goalsnOverall supply base vision with management support.3

36、2Buyer-Supplier RelationshipsnDeveloping closer relationships with suppliers is often an objective of the supplier evaluation and selection processnThe traditional supply model featuring multiple suppliers,short-term contracts,and mutual mistrust can create undesirable consequences-nSupplier profit

37、maximizationnNo incentive to invest in assets to support the relationshipnLimited joint innovation and improvement effortsnHigher transaction and maintenance costsnLimited opportunity to pursue value-creating activities with suppliers.33Buyer-Supplier RelationshipsSpectrum of Buyer-Supplier Relation

38、shipsAntagonisticCollaborativeAdversarialCooperativeLose/LoseWin/LoseWin/WinnParties work actively against the needs of the othernNeither party takes responsibility for anything that happens in the relationshipnParties are engaged in competitive strugglenParties attempt to capture the maximum value

39、for their sidenParties realize the benefit of working togethernCloser relations are a result of mutual goalsnSupplier input and involvement begins to increasenCongruence of goals existsnParties work together to satisfy the needs of each other and create new valuenParties search for creative solution

40、s jointly.34Financial Ratio AnalysisnFor new suppliersnFor purchase requirements involving significant dollarsnFor critical itemsnWhen pursuing longer-term agreementsnTo manage business risknTo eliminate marginal suppliers early in the evaluation process Supplier Financial AnalysisDo it when?Why do

41、it?.35Financial Ratio AnalysisSources of Supplier Financial InformationCompany-published annual reportsCompany-supplied 10-K and 10-Q reportsDun and Bradstreet reportsTRW credit reportsTrade and business journalsSupplier provided data.36Financial Ratio AnalysisLiquidity RatiosLeverage RatiosActivity

42、 RatiosProfitability RatiosnHow capable is the supplier of meeting short-term cash needs?nCurrent rationQuick rationIs the supplier over-leveraged and capable of paying long-term obligations?nDebt to assetsnTime interest earnednFixed charge coveragenHow effectively is the supplier managing assets?nI

43、nventory turnovernAverage collection periodnReturn on net assetsnHow profitable is the supplier?What rate of return is the supplier earning?nGross and net profit marginnReturn on equitynReturn on investment.37Improving Selection Cycle Time ExercisenEach step of the supplier evaluation and selection

44、process has an associated cycle timenCreatively identify ways to shorten the time required to successfully satisfy supplier evaluation and selection requirementsStep 1:Recognize that a need exists to evaluate and select a supplierStep 2:Identify key purchasing/sourcing requirementsStep 3:Determine appropriate sourcing strategyStep 4:Identify potential supply sources Step 5:Limit suppliers in selection poolStep 6:Determine method of supplier evaluationStep 7:Make supplier selection decisionStep 8:Negotiate and execute agreement.