Before we begin reviewing the attributes of good suppliers, let's fly high with fighter jets.
These aircraft have very specific capabilities: they're designed with powerful jet engines, lightweight fuselages, and are able to perform tight maneuvers in a split second. When flying in an airshow, aerial acrobatics are precisely controlled and coordinated in unison with other jets, a visual testament to each pilot's skill. A huge amount of technical expertise, leadership, effective communication, and safety is required.
Now let's pretend these jets never leave the tarmac. How could spectators ever realize their performance potential? The simple answer is they wouldn't. To extend this logic, suppliers should be evaluated by both their pending capabilities and how they perform after they've caught your attention. Avoid limiting your considerations to hypothetical abilities and include expectations of quality, efficiency, and compliance.
In no particular order, here are the top 5 criteria to evaluate when determining the caliber of your suppliers. Keep in mind that high-quality suppliers will enable companies to achieve improved product consistency, lower inventory levels (minus inconvenient out-of-stock issues), lower overall costs, less stress, greater process efficiency, and ultimately a more respectable brand.
Suppliers must have the required technical expertise to meet your corporate needs. It's wise to determine each supplier's certification of quality - the International Organization for Standardization provides ISO ratings that will signify a vendor's capabilities. A supplier's facilities, equipment, and financial statements must be in optimal form if they intend to facilitate your organizational success.
Suppliers at the front of the pack will employ best management practices without hesitating. All policies & procedures are documented and Business Continuity Planning (BCP) tactics such as risk management & mitigation are well-established. Suppliers with strong leadership typically use the DMAIC approach for optimizing processes - Define, Measure, Analyze, Improve, and Control - which is a technique that can also drive innovation.
The ideal supplier will follow market trends while deciphering product quality specifications & appropriate delivery terms with ease. Communicative suppliers are also more likely to adhere to laws and regulations, as they understand the consequences of failing to meet legal requirements.
4) ETHICS & VALUES
When selecting your suppliers it's important to consider their ethics and values for several reasons. This will set the bar for interactions with both customers and the community, which ultimately affects buyer transactions and the quality of materials. Additionally, a supplier that has their ethics and values aligned with yours is easier to trust. Heightened trust creates a stronger buyer-supplier relationship and could even lead to product discounts.
5) HIGH PERFORMANCE
Do your suppliers meet, or exceed, expectations of quality? What about promptness? Have they exhibited compliance with documentation requirements? Can they efficiently resolve conflicts when they arise? All these questions must be answered favorably in order for your suppliers to meet performance criteria.
These five categories will allow companies to identify suppliers that are ready to take off and elevate procurement to its cloud-worthy status.