Assessment of the supplier’s is vital for organizational progress

Suppliers play a key role in an organization's progress. The relationship between the suppliers and the organizations is built on a solid foundation of value and virtue. The growth and progress of the organization depends majorly on the values that the suppliers can offer in their products. The extent to which organizations and suppliers can work together focusing toward their respective or common goals will drive the sure success for both the ends. However, suppliers contribute significantly in providing sources of competitive advantage to the organizations against their competitors as well as to save cost and achieve efficiency of their products and services.

Supplier products must be accurate and efficient as all what manufacturers purchase from the supplier is eventually transfigured as the final product. This means that there is a higher inherent risk or potential impact from each other on both the parties. Also, different supplier has to offer different types and quality of products. It’s in your best interest to select and work with suppliers in ways that will provide for high quality and assurance. In order to overcome from such inconsistencies manufacturers often develop detailed Supplier Evaluation processes.

Supplier Evaluation is a process applied to the suppliers from which the organization is purchasing the raw materials, in order to measure and monitor their performance for the purposes of reducing costs, mitigating risk and driving continuous improvement in organizational operations. It is a continual process which often takes the form of either a questionnaire or an interview; sometimes even a site visit is included in it. This process results as an assessment of various aspects of the supplier including capacity, financials, quality assurance, organizational structure and performance. Supplier Audits are also carried out to evaluate the correctness of the supplier products and offerings before deploying them in a production.

Based on the results obtained from Supplier Evaluation a supplier is scored as either approved or not approved as one from whom to procure materials or services. In many organizations, there is an approved supplier list to which a qualified supplier is then added. If rejected the supplier is

generally not made available to the assessing company's procurement team. Once approved, a supplier will have to go through Supplier Audits on a periodic, often on annual basis. This ongoing process is defined as supplier performance management.

Whenever conducting a Supplier Evaluation or Supplier Audits, the inspectors must understand that Supplier performance is not just about a low purchase price. They must focus on all areas like cost of transactions, communication, problem resolution and switching suppliers, supplier’s reliability, as well as the supplier’s internal policies such as inventory levels etc. However a well designed Supplier Evaluation process results in many benefits to the organization like:

Helps in sourcing from suppliers that provide high standards of product and services.

Help in mitigation against poor supplier performance or performance failures.

Assure sufficient capacity and business stability.

It helps customers and suppliers to identify and remove hidden cost measures in the supply business.

Also motivate suppliers to improve their performance in future.

Recently many Supplier Evaluation tools have come up in the market that can help to gather and track supplier performance data across various sites, business units, and regions very quickly and easily. These automated tools offer more comprehensive and objective picture of supplier performance, which can be used to make better sourcing decisions, as well as identify and address systemic supplier performance problems. With such software’s Supplier Evaluation and Supplier Audits are much simplified and can be carried out without consuming much of the manufacturer’s time and cost. . Learn more at http://www.aqss-usa.com/quality-auditing-services.asp