A scorecard that measures only price and on-time delivery tells you almost nothing about whether a supplier will fail you next quarter. After building scorecards across $1.85B in managed assets, we use seven dimensions — and weight them by what actually predicts risk.
The 7 Dimensions
Quality (PPM defect rate, RMA rate), Delivery (OTD to promise, not to revised date), Cost (total cost of ownership, not unit price), Responsiveness (RFQ turnaround, issue resolution time), Compliance (certification currency, audit findings), Innovation (cost-down ideas, VA/VE participation), and Risk (financial health, single-source exposure, geographic concentration).
Weighting for Prediction
The mistake is weighting all dimensions equally. For a critical machined component, quality and risk should dominate. For an indirect commodity, cost and responsiveness matter more. Weight the scorecard to the consequence of failure for that specific category.
Measure Against Promise, Not Excuses
On-time delivery must be measured against the original committed date. Allowing suppliers to reset the clock with revised dates is the most common way scorecards lie to you. Enforce boundaries — we typically hold 0 days late and 2 days early.
Make the Scorecard Consequential
A scorecard nobody acts on is theater. Tie scores to a Partner / Maintain / Develop / Exit strategy: reward top performers with more business, put developing suppliers on improvement plans, and exit chronic failures on a defined timeline.
Key Takeaways
- Measure seven dimensions, not two — quality and risk predict failure better than price.
- Weight the scorecard to the consequence of failure for each category.
- Measure OTD against the original promise date, never a revised one.
- Tie scores to a Partner/Maintain/Develop/Exit action framework.