How to Manage Suppliers Effectively?

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audit Quality
Supplier evaluation

Suppliers are a key variable in the quality you can deliver as a company. Whether they supply materials or perform services, they do have a significant impact. Suppliers are almost as important as customers and employees. Therefore, it is crucial they are managed properly and evaluated regularly. 

Suppliers Check

When a new supplier is needed, make sure you do a thorough suppliers check. It is still very common to have the standard checkboxes, generally the ISO certificates is one of those boxes. However, with your knowledge of the certification processes, would you trust the quality of a company solely on their certificate? Especially when they are a key supplier for your product or service? 

You could go for a supplier audit and check their facility yourself. This is very labor intensive and time-consuming, so it’s unlikely you will do this for all suppliers. However, for critical suppliers this might be a good way to start. For less critical suppliers, you can do a paper check. Ask the company to get access to their management system to see how they operate and where their key quality checks are. Also, ask for some additional pictures or maybe a video about their facility to give you a better idea. It doesn’t give the complete picture, but it is much better than just checking the box of an ISO certificate.

Continuous Supplier Evaluation

When you’ve selected a new supplier, make sure there is a proper supplier evaluation process defined, preferably an ongoing process. Tracking minor and major issues related to the supplier is key here. This information is crucial during discussions with the supplier and how to improve the combined efforts. The information could be gathered by performing quality checks on incoming goods and services or by finding out through customer issues. A mobile app is crucial to make it very easy for people to register an issue. Regularly checking on-time deliveries is also a good method to evaluate the supplier.

Periodic check

On top of continuous evaluation, it is good practice to have a periodic check on the key suppliers. This doesn’t have to be monthly, it can very well be quarterly or yearly depending on the importance of the products or services of the supplier. 

This periodic check allows for a more thorough examination of the supplier. Again, this can be on paper or you could go for a supplier audit approach. Make sure you have a concise approach on evaluating suppliers so it is carried out correctly. An audit checklist or supplier checklist is a great way to do this. In this process, it is important you not only look for things that went wrong, but also look for positive things. When the audit is performed at the supplier on-site, make sure the auditor has a proper mobile app to file the audit reports. This makes analyzing the results much easier. 

Not only focusing on the issues but also communicating the positive results with the supplier will help establish a good relationship. Even though they get paid for their service, it is still good for morale to give them a compliment when they did a great job. If you want to go one step further, you can create different statuses for your suppliers. This will give them an incentive to keep up their good service. In the end, you are all in it together.

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