There is a need for the enterprise to take a strategic and systematic approach to improve supplier performance, rather than engaging on a tactical, short-term and purchase-to-purchase basis. Supplier development is based on engaging the right suppliers, with the right capabilities and willingness to align operational objectives. Supplier performance assessments are a means for gauging the capability and capacity of the supplier to meet the client's business and operational requirements.
Supplier assessments should take place before developing a long-term strategic relationship. They are a valuable tool to assess at an early stage whether or not supplier development is feasible and determine which suppliers can deliver the necessary process improvements. The key aim of assessment is to encourage the right suppliers with the right structure to coordinate their efforts with yours.
A solid Supplier Development Strategy is built by defining the key process and sets the criteria against which suppliers will be assessed. It provides the concrete link between the aims and priorities of the client as a whole and their suppliers and is therefore vital to business process transformation with the right suppliers being chosen for long-term relationships.