Supplier evaluation is ruled in the new ISO 9001:2015, released in september 2015, under the chapter 8.4 - “Control of externally provided products and services”. Although a general process is being described, no specification or criteria are given to rule the evaluation itself. Small companies can use a standard form and classification while companies with a large number of suppliers will often use a more complex system, demanding a lot of time to process all their suppliers evaluations.
Here is what you need to know to keep your evaluation process easy and efficient as possible.
Suppliers selection: which suppliers are critical for the production process?
The ISO 9001 standard requires that all decisive suppliers should be evaluate.To do so, your first step will be to classify and select your suppliers depending on their weight in your production chain and for your company. To help you find out who your critical partners are, you can use our infographic profiling the 4 different types of suppliers.
To have an efficient process, you will also need to have a clear internal task distribution and determine who or which department will be in charge of the evaluation and how often it should be done. As a hint, evaluation are executed on a yearly basis by the purchasing and quality management departments.
Defining evaluation criteria: which criteria are fundamental and decisive for the supply?
The standard rule does not give any precise indication regarding the criteria needed to be checked by the evaluation. Nevertheless, the most common criteria checked during an evaluation are the following ones:
Information and documents such as contracts, delivery specification, complaints or work instruction constitute the basic data you will need for the evaluation. These documents should in advance be requested and filed in advance in your supplier documentation.
Defining importance: how decisive and critical is this criteria for the delivered service or product?
It is important to determine the weight of each criteria on which the suppliers will be evaluated. Depending on the product or service, a criteria can have a complete different significance from a company to another. However, the most common criteria are quality and price. During the evaluation, points will be given for each criteria and a sum will be established after the application of the coefficient given to each criteria.
Classifying the suppliers: which measures are taken after an evaluation ?
The classification of suppliers is made after the evaluation has been completed and the total sum of points has been calculated. Depending on the performance in its commodity group, the supplier can be sorted and different measures can be taken to further develop the suppliers and the partnership associating you.
As an example, suppliers can be sorted following this logic:
Sharing the evaluation: how can I make the best of the evaluation process ?
Once the evaluation process has been completed, the outcome is the most important to make sense of the whole process.
As a buying company you get an overview on the production chain and its weak/risky spots. As an evaluated supplying company, you have the opportunity to improve the quality of your product/service. It is important for both parties to share and discuss the performance of the supplier and to clearly explain on which criteria the supplier has been evaluated. The discussion should lead to a list of improvements to enhance and improve the ongoing business partnership.
Collaboration in this final part of the evaluation is crucial and should be seen as a regular checkpoint to share feedbacks and experiences. This is a corner stone to build a strong and long lasting partnership.
Digital supplier evaluation: how can I be more efficient and bring this evaluation to the next level ?
Best practice: using a Supplier Relationship Management system, integrating in one place suppliers data, documentation and evaluations.
A digital documentation system for the supplier evaluation can especially make sense for companies dealing with a large number of supplier. By using such a solution, you can benefit from the following functions:
- Standardised and systematic supplier evaluation
- Clear task distribution when several persons are involved in the evaluation process
- Easy analysis of the evaluation results
- Quick sharing of the results with the supplier and direct access to the evaluation documents possible
- Systematic and digital archiving of the evaluation process and its documentation