The supplier scorecard system at Metalcraft has been used for evaluating each of their supplier’s performance. It reports upon selected improvement metrics for Metalcraft suppliers.
The scorecard system has many strengths and offers many benefits to the company. There is power in information, and the constant evaluations provide Metalcraft with the ability to expose weak spots and define areas of improvement within their supply chain.
There are many strengths that the scorecard offers. The scorecard provides metrics on competing suppliers over time, allowing Metalcraft to determine which suppliers are more valuable and critical to their operations. After each evaluation, the results are benchmarked and directly influence the supplier’s placement into one of three categories; Preferred (green),
Non­Preferred (Yellow), and Non­Preferred (Red). This makes supplier selection easier, faster, and more effective. The scorecard evaluations have helped Metalcraft improve its manufacturing by giving Plant Quality Engineers a historical perspective of problems. In addition, the Supplier
Development Engineers are not physically located in Metalcraft plants and wouldn’t know of any problems immediately. Daily performance can be scored, and problems can be located earlier. Recurring defects resulting from a supplier’s production process can be minimized by choosing a Preferred supplier. The suppliers themselves may use the scorecard as a guide for internal improvement, to monitor the health of their relationship with Metalcraft, and to strengthen their competitive position in future bids for new business. The constant evaluation will make the top supplier’s shine through and encourage others to improve.
As with anything, when there are strengths, there are weaknesses. In the highly competitive environment Metalcraft is in, supplier relations are becoming of higher importance.
However, buyer and supplier personnel frequently change jobs making it difficult to maintain the original relationship that was established. This relationship can also become blurred depending on the number of supply channels. This relates to another issue with the scorecard. Some suppliers have multiple production facilities and ship components to various Metalcraft facilities around the world. Production facilities differ significantly, impacting the final quality of the component. Misrepresentation is another issue, a onetime mistake could possibly cause a good supplier to look bad. Mistakes and inconsistencies can reduce the set of suppliers to choose from, making the firm less responsive. Another complaint about the Scorecard is that it did not provide extremely detailed information nor query functions that would be useful in evaluation and selecting suppliers.
The suppliers MetalCraft uses have a higher incentive to perform well because of the constant evaluation and benchmarking of their scorecard. Metalcraft is unique in regards to allowing their suppliers to see their scores. This drives Metalcraft’s suppliers to perform at an even higher level than before. The scorecard also makes it easier to see where their relationship with MetalCraft stands. The “Green, Yellow, Red” ranking system, in conjunction with the transparency of the scorecard score, allow the supplier to be completely aware of where they stand with Metalcraft at any point in time. This knowledge can push for higher performance, allowing the supplier to see it’s weaknesses from Metalcraft’s perspective, and drive internal

supplier improvement to achieve a higher score. Sourcing issue fees are charged back to the supplier, creating even more incentive for the supplier to perform at it’s best to avoid additional fees and scorecard deduction.
Buyers have high incentive in regards to integration of the scorecard. Their salary is directly tied to the negotiated price, if they source poorly they will subsequently be paid poorly.
In the past there was a heavy reliance on personal inputs from the engineer or plant manager, now there is factual information to impact decisions. However, the strictness of the scorecard may also limit the pool of suppliers, as some will be eliminated based on performance. In the quality department’s opinion, they are not directly involved in purchasing decisions. The quality department does, however, input data into the scorecard which impacts the end decision. Plant quality engineers analyze the scorecard to ensure their products are high quality and defect free.
If quality issues, such as the rubber vent hose problem, continue arising, it might be wise to integrate the quality department more directly in purchasing decisions. This would help
Metalcraft source as highly in quality as they want. In the case, the scorecard was cited for numerous improvements it made within
Metalcraft such as better visibility, improved supplier decisions, and eventually greater customer satisfaction. In some cases though, there were disagreements when using the scorecard which can be improved. The first improvement would be the advertising and legibility of the system.
Darrell Bonds, a product engineer, stated that even though he wasn't an avid user of the system, most product engineers were most likely not aware of the scorecards existence. The acronyms and supplier codes were not defined, leaving engineers in the dark. He said they needed to do a better job advertising and after, explain it to Metalcraft management.
Some ways to fix it would be to reengineer the system to make it more accessible and interactive. They need to simplify the codes and acronyms so product engineers can input the information to their products. It could improve efficiency and lower complexity. When it comes to advertising they could send email alerts and notifications when suppliers within the system have changes in their processes which affect their scores. Having real­time information and better communication could help engineers when they need to place a new order. By communicating more effectively and providing employees with adequate knowledge of how the scorecard works, Metalcraft could improve its effectiveness, minimizing any miscommunications between the different organizational roles.
Another issue was the scorecard accounted for “one time mistakes” in their numbers and the overall reliance on the system. Jack Dawkins, a quality control manager, had 75 parts rejected by Metalcraft because the parts were dirty, even though, the parts were clean when they left the factory. Metalcraft essentially said “tough luck” when he called to argue the case. This affected his scores and relations with the company. In order to have a scorecard like they do, there needs to be more assets invested in investigating cases. Jack was not in the wrong because the parts were put on Metalcrafts truck clean, but had bird manure on them on transport. These poor scores for Jack could affect future business with the company.

Metalcraft Supplier Scorecard Team 2
Braden Burns
Richie Jager
Jesse McCormack
John Hoskins
Ryan Forsthoffer