The Procurement and Supply Manager's Desk Reference, + Website, 2nd Edition

CHAPTER 4

Supplier Selection Criteria

The Procurement Department is expected to lead the process of evaluating competitive offers and selecting the supplier for any particular contract. The methods used for selection are some of the most important elements of the procurement professional's skill set. Indeed, effective supplier management, one of Procurement's most vital functions, truly begins with establishing the proper initial selection criteria and ensuring that the right supplier gets chosen. Too often, inadequate preparation and effort goes into this process with predictably disastrous results: the wrong supplier chosen or disappointing supplier performance. Even worse, in too many organizations a weak and poorly trained buyer staff has virtually no input into supplier selection and contract awards in the first place, yet is expected to manage ongoing supplier performance. That is why it is critical that you clearly understand the methods available in supplier selection and employ them professionally.

This chapter introduces you to evaluating and selecting suppliers for specific contracts and some of the methods available to measure and manage a supplier's ongoing performance.

Selecting the Supplier and Awarding the Contract

You cannot make a silk purse out of a sow's ear. To produce a specific result, you must choose the correct mechanism. The supplier is the fundamental resource employed by your organization to meet its requirements, and if you do not select correctly, ...