Apply Supplier Performance Management to Desigual suppliers to improve the Supply Chain performance

Abstract

This project aims to describe a way how to assess suppliers in order to get the best of each supplier and to allocate the production in a clever way. By applying Supplier Performance Management (SPM) in Desigual Supply Chain we expect to identify those suppliers who balance between quality, price, service lead time and compliance of Desigual code of conduct. Hereinafter, the SPM is explained as well as all the KPIs that will form part of the study. These KPIs are: Service, Quality, Corporate Social Responsibility (CSR), Cost and Innovation. By analyzing these five KPIs we attempt to obtain a 360º view of the supplier, not only focusing on supply chain issues but in a global context, this means, analyzing the supplier in all the areas of the company. Once the study in conducted, we can represent the suppliers in a matrix where the supplier production faces its score. In the matrix we identify four areas or regions, Strategic Suppliers, Good Suppliers, Flop Suppliers and a restricted area. In the strategic suppliers’ zone, we find suppliers who balance between high production volumes and high scores, these suppliers are those where the company trust the most. On one hand, we find good suppliers’ zone, these suppliers obtain high scores but their production is not enough to become strategic suppliers, but helps to identify potential strategic suppliers. On the other hand, those suppliers who obtain low scores and have low production, can be found on the flop suppliers’ area. Finally, in the restricted area we can find suppliers who obtain low scores and have high production volumes. These are very dangerous for the company as they have much production of the season and their scores are very low. Finally, we will propose a way of sharing the information. We will suggest a Dashboard, using a color scale following the hue of a traffic light, helps to the manager who is reading the information to detect by a first look in which KPI the company is not performing well, or in which product category the company is performing in a perfect way.