Opening Up the Dialogue
The word “feedback” often comes with certain connotations. Depending on the people you’ve worked with, the word may elicit a “brace yourself” reaction.
But when it’s time for you and your suppliers to discuss what you’ve learned from your assessment, the goal is to avoid that response at all costs.
Lay the Foundation
If you’ve never had a frank conversation with your suppliers about your expectations and their performance, you’ll want to approach the conversation openly and ease them into it.
Let your partner know why you’re opening this dialogue—what are your goals? Go over the metrics you’re using to gauge their performance—why have you chosen them?
Get your supplier involved in this part of the conversation, too. Pause along the way and see what questions your partner may have.
Review the Results
Next, take your partner through the findings and explain your approach to scoring. This is another good place to stop and see what your partner is thinking.
Be sure to celebrate great results. For example, thank suppliers for their commitment. Show them the positive impact they’re having on your business. Suggest “good to great” action items, which will help boost future results and strengthen the partnership.
Conversely, when suppliers aren’t pulling their weight, don’t shy away from the conversation you need to have. For example, talk about the areas where the supplier’s performance is falling short. Discuss how these issues are slowing the growth of both your businesses. Then, figure out how to get things back on track—for example, by setting SMART goals for your partner and yourself—but be clear about the consequences if results don’t improve.
Create an Action Plan
Next up, develop an action plan for your supplier matrix. This plan, of course, needs to address any areas of concern, but it should also consider ways to take a supplier’s good performance to great or to sustain their overall excellence.
|Key Differentiator||Measurement||Supplier A||Supplier B|
|Results||Action Plan||Results||Action Plan|
|#1 Best New Products||Innovation
|H||Travel to design shows together, build future collaborations||L||Nothing – not looked to as an innovative resource|
|#2 Responsible Production||GOTS Certified (Binary: Y/N)||Y||NA||N||Understand current actions being taken to secure GOTS certification, set date for completion|
|#3 Responsible Global Citizen||Approved list of COPs (Binary: Y/N)||Y – Portugal||NA||Y- Indonesia||NA|
|#4 There where you need us (i.e. – growing into new markets)||Supplier capacity (Binary: 3M units or Quantitative: % available to secure)||1.2 M Units, 11%||Discuss opportunities to increase production capacity or secure additional production space||3 M Units, 21%||Discuss growth plans and understand if you have the ability to secure more production space.|
|#5 Always instock, All the time||On Time Shipment Rates, Fill Rates (Quantitative: percentages)||OTS: 78%
|Discuss opportunities to elevate on time shipments and fill rate, set goal for improvement date and scores||OTS: 99%
Supplier A: This action plan centers on elevating a key strength (innovation), securing needed production space, and improving execution metrics (shipping and fill rate). Improvements in all these areas can mean business growth, a great motivator for both of you.
Supplier B: This action plan helps your partner obtain a Global Organic Textile Standard (GOTS) certification, so your organization can fulfill one of its key differentiators. It also has an “it-would-be-even-better-if we” action item, focused on gaining more production capacity or space to meet your growth goals.
By the way, even though Supplier B is rated low on innovation, there is no action item to address it. That’s because Supplier B provides basics, and you don’t need them to develop trend know-how.
Outline Next Steps
As you go through the action plan, ask how you can help your supplier, too.
The benefits are twofold: (1) you position yourself as a partner, committed to the success of both organizations, and (2) you open the door to getting helpful feedback from your suppliers.
Keep Talking and Reviewing
Aim to have this discussion with your suppliers annually. Review metrics quarterly, checking for progress and improvements. And keep learning—know how supplier improvements affect your bottom line and use that information to refine your goals and dialogue.
Better yet, build this process into your annual business planning cycle and watch your business thrive!
Pulling It All Together
In future articles, we’ll dig into troubleshooting, real world examples, and additional resources you can use.