“16T”: toward a dynamic vendor evaluation model in integrated SCM processes

Abstract

Purpose

The purpose of this paper is to provide a “trait based approach” for vendor selection and evaluation for expensive procurements in large businesses through a simple and easy‐to‐use mathematical model using safety, quality, delivery and cost criteria. Design/methodology/approach – We use 16 traits addressing safety (S), quality (Q), delivery (D) and cost (C) areas for evaluating performance of a vendor on a linear 10 point scale. We start with evaluating each “supplier‐supply item” combination and compute gross averages for each of the SQDC areas and finally arrive at an “Overall Performance Index” for each supplier‐supply item combination. These indices form a “Vendor Performance Dashboard” for decision making. Findings – The case study shows that the proposed method is quick and easy to adopt, and provides a logical framework for vendor selection and management, based on performance in the four critical (SQDC) areas. Research limitations/implications – A lot of monotonous computations are required for the proposed vendor evaluation process. Hence, the scope for software development warrants further investigation. There is also a need to develop a process for weighting the different SQDC elements for application in different industry/market contexts. Originality/value – This paper presents a unique and simple approach for generating dashboard data for decisions regarding evaluation of vendors and distribution of sub‐contracts in a dynamic technology intensive market with practical examples. The proposed model for vendor selection and determination of order sizes is less dependent on complex algorithms and more practical and logically framed than existing models.

Citation

Pal, P. and Kumar, B. (2008), "“16T”: toward a dynamic vendor evaluation model in integrated SCM processes", Supply Chain Management, Vol. 13 No. 6, pp. 391-397. https://doi.org/10.1108/13598540810905642