Performance measures are not always what they appear. At times they reveal a hidden story that can only be found by peeling back the onion. Let’s pursue this concept with an example. A customer is attempting to identify a new supplier and reaches out to four potential suppliers to complete a survey. The survey includes a question for the supplier to document their on-time-delivery performance (table 1).
If you were the customer which supplier is the best performer? Many companies would pick supplier B. It is impressive that they do have an On-Time-Delivery performance of 100%. But do they meet their need? The customer requires daily deliveries by their supplier’s carrier that must be at the facility by 6 a.m. so they are received and ready for production by 7 a.m. Thus, their selection of supplier B would be a good choice. But is it? Let’s look deeper at each one of these performance measures and how they are determined.
Does this information on how the performance measure is determined change your selection for the best supplier to meet your needs? This would change my selection if I was the customer. The results of customer B look excellent, but it does not reflect my critical component of proper delivery each morning by the supplier’s carrier of choice. Supplier A needs to be treated with caution since their performance measure is limited to usage of their own trucks. More information is required on whether their trucking would be delivered to their location or if a carrier would be required. Suppliers C & D have strong possibilities based on how the measures are determined. Supplier D may have an advantage with their performance increase from 2022 to 2023. Let’s be aware that this is just one component in the decision-making process but is crucial for this customer based on their need for a shipment each morning.
