Visual performance Management Oct 20 OIPMAC
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The document presents findings from a 2012 annual conference on supply chain risk and performance monitoring, emphasizing the importance of automated evaluation systems in various sectors such as municipal and academic. It discusses organizational examples, performance measurement metrics, and documentation practices to enhance contractor management and supplier evaluations. Key challenges noted in effective vendor performance management include time constraints, system deficiencies, and maintaining end-user input.
Visual performance Management Oct 20 OIPMAC
- 1. 2012 Annual Conference Presentation Supply Chain Risk and Performance Monitoring: The use of automated systems to help you manage key areas of your organization
- 2. Which sector are you in? Pick one! 1. Municipal 2. Academic 31 (University/College) 3. School Board 4. Health Care 5. Broader Public Sector 6. Private 3 7. Federal/Provincial 2 0 0 1 1 1 2 3 4 5 6 7
- 4. How many Canadian employees work for your organization? Pick only one! 1. 1 to 9 12 2. 10 to 24 3. 25 to 99 8 4. 100 to 249 7 5. 250 to 499 6. 500 to 999 4 3 3 7. 1000 to 2499 2 8. 2500 + 0 1 2 3 4 5 6 7 8
- 5. Other than OIPMAC which Organization(s) do you belong to? Pick as many as you would like! 1. OPBA 24 2. CPPC 3. NIGP 4. OECM 5. CMC 6. HSCN 8 7. Construction Association 5 8. ISM 4 9. Other 0 0 0 0 0 1 10. None 1 2 3 4 5 6 7 8 9 10
- 6. Survey Says! OPBA = Ontario Public Buyers Association CPPC = Canadian Public Procurement Council NIGP = National Institute of Governmental Purchasing OECM = Ontario Educational Collaborative Marketplace CMC = Canadian Association of Management Consultants HSCN= Healthcare Supply Chain Network
- 7. How many competitive bids did your group issue in 2011? 20 1. 1 to 49 2. 50 to 99 3. 100 to 149 9 4. 150 to 199 5. Greater than 200 1 0 0 1 2 3 4 5
- 8. How many competitive bids did the Town of Oakville issue in 2011? 180
- 9. On average how many vendor performance evaluations do you do per year? Pick only one! 22 1. None 2. 1 to 10 3. 11 to 25 6 4. 26 to 49 3 3 2 5. 50+ 1 2 3 4 5
- 10. Survey Says!
- 11. Which tools or methods do you use? Pick as many as you would like! 23 1. Checklists 20 2. Forms 17 17 3. Templates 4. User Guides & Manuals 11 5. Progress meetings 7 6. Performance 6 documentation 7. 3rd Party verification 1 2 3 4 5 6 7
- 12. Which tools or methods do you use?
- 13. What triggers an evaluation? 1. Periodic 19 18 2. Budget Threshold 3. Contract performance 15 4. Project profile 13 5. New vendor 6. Project complexity 7. Client Dissatisfaction 6 6 8. Repeat vendors 5 9. Length of Engagement 3 3 2 10. Every Project 1 2 3 4 5 6 7 8 9 10
- 14. Survey Says!
- 15. Why Measure Performance? • Support better decision making • Support better communication • Provide performance feedback • Motivate and direct behavior Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 15 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 16. Problems with Purchasing and Supply Chain Measurement and Evaluation • Too much data • Wrong data • Measurements that are short-term focused • Lack of detail • Drive the wrong performance • Measures behavior vs. accomplishments Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 16 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 17. Performance Measurement • Effectiveness – Extent to which, by choosing a certain course of action, management can meet a previously established goal or standard • Efficiency – Relationship between planned and actual sacrifices made to realize a previously agreed- upon goal Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 17 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 18. Metrics Key • SPECIFIC • MEASURABLE • ATTAINABLE • RESULTS ORIENTED • TIME-BASED Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 18 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 19. Develop Specific Measures • Objectivity • Directly related to • Clarity organizational • Use of accurate and objectives available data • Joint participation • Creativity • Dynamic over time • Non-manipulative Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 19 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 20. Measurement System Characteristics • Effective measurement requires consistent and reliable data • Periodic review of measurement system to … – Eliminate unimportant or unnecessary measurements – Add new criteria as required – Reevaluate objectives or targets – Objective versus Subjective criteria Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 20 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 21. Measurement System Characteristics • Measurement is not free • Not all aspects of performance lend themselves to quantitative measurement • Purchasing and supply management is better served by a few precisely defined and thoroughly understood measurements Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 21 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 22. Measurement and Reporting Frequency • Reporting frequency to buyer – Day-to-day performance for troubleshooting and expediting • Reporting frequency to supplier – Routinely summarized monthly or quarterly – Annual face-to-face meeting • Never delay reporting supplier’s poor performance Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 22 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 23. Uses of Measurement Data • Identify poor performing suppliers • Support supply base optimization and rationalization efforts • Determine future purchase volume allocations • Identify performance improvement opportunities • Make sourcing decisions Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 23 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 24. Supplier Performance Management • How does buyer know how well any given supplier is performing? • Consists of methods and systems to collect and provide information to measure, rate, or rank ongoing supplier performance • Acts as supplier “report card” Leopold Koff, B.A., B.Ed., CPSM, CPM, CSCMP 24 Professor, Supply Chain & Operations Management School of Business & Hospitality
- 25. Working with Contractors WHAT IS THE PURPOSE OF A CONTRACTOR PERFORMANCE EVALUATION? • To ensure that contracts stay on track • To deal with issues and problems as they arise • To develop a relationship with contractors and an understanding of what is expected • To document poor performance to alleviate the never ending cycle Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 26. Steps to Good Performance Management • Establish and implement procedures for review of performance problems and/or disputes • Have a consistent ranking system and procedure – follow it! • Conduct regular inspections-project managers • Have written report, minutes, notifications Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 27. Documenting Performance • The MOST crucial part of performance management • Weekly site meetings – up date the contractor on upcoming issues or problems that have occurred. Get feedback from the contractor on how he feels the contract is going – take his suggestions to heart. • Distribute site meeting minutes as soon after the meeting as possible • Ask the contractor to note any exception to the minutes in an email or memo. Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 28. Documenting Performance • Any performance issues MUST be discussed with the contractor • Contractor give reasonable time to correct the issue • DOCUMENT all issues – copy contractor on all documentation • Suggestion: Two part report form – initialed by contractor • Never put yourself in a position where the contractor can say, “I had no idea!” Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 29. Types of Documentation • Contract Check List – Details deliverables and project milestones • Observation Record – Document observations of Contractor Performance • Complaint Record – To document and follow up on complaints • Discrepancy Record – To note contract discrepancy, copy to contractor with expected actions. • Field Diary – Used to keep track of daily records – be careful what you write. Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 30. Types of Documentation • Summary Evaluation Report – This is the contractors formal evaluation. – Conducted annually and/or upon completion – Reports can be done more frequently for probationary or problem contractors – All notes and documentations are attached – Meet with contractor to discuss final outcome Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 31. Contract Management • Be flexible • Exercise sound judgement Contracts are not held together by forms, surveys, diaries or other monitoring tools – but by the contract team! Effective contractor monitoring depends more on the skills of the MONITORS than the monitoring methods • A delicate balance of time and money vs the potential for disruption a service delivery. Kim Dooling, CPPB Manager, Purchasing and Risk Management Financial Planning
- 32. Examples of Automated Systems RAQS TQRDC VPM
- 34. On a scale from 1 to 5 what is the average score you give to your contractors when you do evaluations? 17 1. Poor 12 2. Acceptable 3. Standard 4. Good 3 2 5. Excellent 0 1 2 3 4 5
- 35. Central tendency State of Florida Overall Rating 70% 66% 5105 Surveys conducted in April 2010 60% 50% 40% 31% Overall Rating 30% 20% 10% 3% 0% >= 1.00 to <= 2.80 >= 2.81 to <= 3.20 >= 3.21 to <= 5.00
- 37. Ministry of Transportation Ontario MTO uses the Registry, Appraisal & Qualification System (RAQS) to manage vendor qualification and vendor performance for infrastructure procurement RAQS is an integrated solution with support for: • MTO user roles • Process workflows • Internal system interaction • Internal and external communications
- 38. RAQS Key Functional Areas – Vendor management • Vendor registration & qualification • Vendor performance assessment • Vendor rating – Project tendering • Project notice advertising • Document distribution • Contractor communications – Bid results and evaluation • Results evaluation / trend analysis • Awards
- 39. Simplified 3M team rating (TQRDC) T – Technology Q – Quality R – Responsiveness D – Delivery C – Cost Courtesy: Jeff van Geel Manager Sourcing & Accounts Payable
- 40. Courtesy: Jeff van Geel Manager Sourcing & Accounts Payable
- 41. Simplified Scorecard 1. Focus on improvement 2. Present facets of performance without aggregation. Do not dilute message. 3. Communicate dashboard – detail in meeting 4. Scope: all material & services Courtesy: Jeff van Geel Manager Sourcing & Accounts Payable
- 42. All information for exercise only Courtesy: Jeff van Geel Manager Sourcing & Accounts Payable
- 43. 1. Construction – Commodity - Contract 2. Contractor - Consultant 3. Consistency - Customizable 4. Crowdsourcing – Collaborative - Comments 5. Compare - Contrast 6. Credible – Context 7. Cost
- 44. ABC Contracting Grand River Ford’s Excavation Landscaping
- 45. • For ratings that are “Below Standard” and explanation must be entered Easy to create, fill out and explain!
- 46. Easy colour coding to spot what needs to be reviewed quickly. Data can be exported for further calculations/ analysis if required.
- 47. 1. Effective communication throughout engagement 25% 2. Quality of resources 3. Availability of resources to carry out contract 17% 16% 4. Quality of the final deliverables 15% 5. Providing value added services 10% 6. Maintaining timelines/deadlines 8% 7. Budget/cost control 5% 4% 8. Having a vendor contact for dispute resolution 1 2 3 4 5 6 7 8
- 48. Survey Says
- 49. What are your greatest challenges to having an effective VPM! 30 Pick more than one! 25 1. Not enough time 2. End user input difficult to 15 15 get 3. Poor systems 9 4. Not required 5. Missing linkage between 4 contract and performance 6. Comparative Consistency 1 2 3 4 5 6
- 50. Do you share performance results with contractors - consultants? 27 1. Yes 2. No 9 1 2
- 51. Do you tie performance management data to proposal evaluations and selection? 23 1. Yes 2. No 9 1 2
- 52. 52
- 53. Gerald Ford CSCMP Leopold Koff CSCMP grford@csolutions.org 226-474-1169 lkoff@conestogac.on.ca 905-296-4003 Kim Dooling CPPB KDooling@oakville.ca Corporate sponsors 53