La crítica a la necesidad de los procesos fácticos

According to Yang (2010) companies are required to improve supply chain competitiveness and this could be accomplished by evaluating and improving supplier’s performance.

3.5.1 Performance measurement

Neely et al (1995) defined performance measure as, “a metric used to quantify the efficiency and/or effectiveness of an action” while performance measurement as, “the process of quantifying the efficiency and effectiveness of an action” (Neely et al., 1995, pp.80). According to Langfield-Smith (1997) performance measurement has been an important topic of study especially in the management accounting field, where the focus area cover performance measures, performance measurement systems and frameworks. Simpson et al (2002) argued for monitoring the supplier performance as in the absence of established

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criteria for supplier evaluation both the company and their suppliers will be unable to meet desired standards of each other. According to Neely et al (1995) SMEs manufacturers come across some performance measure issues like which performance measures add more value and the cost of measure as comparison to its outcomes.

In order to motivate supplier to improve its performance, companies utilize supplier evaluation systems (Kraus et al., 2000). For companies being able to evaluate their current suppliers’ performance provides them with all necessary information about the possibilities of potential development (Hahn et al., 1990). Modi and Mabert (2006) added that supplier evaluation should take the first place before moving forwards toward any performance improvement program or knowledge transfer.

3.5.2 Supplier evaluation process

Yang (2010) developed a model for supplier performance evaluation based on five dimension or variables; finance, customer service, learning, reaction and manufacturing. Each variable was consisting of different measures. According to Sollish and Semanik (2012) supplier’s reviews are conducted by companies to assess the progress of their supplier’s performance. The performance scorecard could be utilized to communicate the supplier performance with the perspective of different categories like cost, quality, level of service on time delivery and other. The performance scorecard includes the desired level of performance among different categories and the current level of supplier’s performance (Sollish and Semanik, 2012).

Fowler and Graves (2011) discussed the process of supplier selection and categorized that into five steps; identification of importance of supply, performance criteria, allocation of weight to performance criteria, supplier assessment based on performance criteria and finally selection of supplier based on the results obtained. They further argued that the evaluation of selected suppliers is also necessary. The criteria used for selecting the suppliers in step two i.e. performance criteria will be applicable for measuring supplier’s current performance level as they have been selected based on that criterion (Fowler and Graves, 2011)

According to Sollish and Semanik (2012) companies need to consider the supplier’s perspective and their feedback for improvements. The supplier performance could be improved through developing en effective plan and it mainly based on six important steps; analyzing the current situation and performance level of suppliers, the identification of gaps from expected level of performance, development of improvement plans, implementation of

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plan, measurement of improved performance level and finally the continuation of this complete cycle for continuous improvements (Sollish and Semanik, 2012).

Forslund (2007) developed a model for logistic performance management for meeting customers’ expectations. The model included seven activities; objective and strategies, definition of metrics, target setting, measurement, analysis, evaluation and improvement process. According to Sollish and Semanik (2012) companies need to decide about type of monitoring technique and schedule of reporting. Supplier review is conducted by the companies through different ways like product testing, supplier site visit and meeting with supplier to identify the causes of performance decline or the improvement areas for achieving the desired objective of the companies from their suppliers (Sollish and Semanik, 2012). According to Simpson et al (2002) the results of their study showed that 45.5 percent of the respondent firms do not have formal method for supplier evaluation.

3.5.3 Supplier performance measures

According to Sollish and Semanik (2012) performance measures do not have the core value until they are compared with certain standards. Organizations can use software for monitoring supplier performance. According to Chan (2003) performance measures are also industry specific, different industries have different importance for performance measures however time, delivery service and part specification are important for most of the industries. According to Simpson et al (2002) traditionally the evaluation commonly based on price and delivery but now communication and customer relationship are considered important factors for suppliers selection and evaluation. Continuous improvements in design and in quality also have significant importance in supplier evaluation (Simpson et al., 2002).

According to Forslund (2006) logistic performance could be analyzed while evaluating measures such as; on-time delivery, decided lead time, order placement procedure, obtainability of delay information, accurate invoices, accurate orders, inventory availability and rush order fulfillment. The study of Simpson et al (2002) identified that firms commonly based their supplier evaluation on variables like supplier certification, quality, distribution factors, relationship factors, facilities and continuous improvements. According to Fowler and Graves (2011) there are different variables which can be considered for assessing the supplier performance such as; price, responsiveness, flexibility, quality, reliability, lead time, specification and other depending on the requirements.

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The study of Simpson et al (2002) classified the supplier evaluation process based on nineteen categories or variables. The variables are listed here according to their importance in their study results; quality and process control, continuous improvement, facility/environment, customer relationship, delivery, inventory and warehousing, ordering, financial condition, certification, price, staff/customer service, leadership/management, technology, education/training, invoicing, packaging, employees, warranty and location. Each of these variables is measured through different evaluation items or criteria’s (Simpson et al., 2002) According to Talluri and Sarkis (2002) manufacturers have considerable importance for critical components while price is not the only variable of concern between manufacture and their suppliers however the variables like quality, flexibility and delivery also have significant importance. According Simpson et al (2002) quality is one of the important factors of supplier evaluation however firms focused on low cost and standard products do not consider quality as most important factor for supplier evaluation.