|
|
> > >
Performance Rating
Electro Scientific Industries considers supplier performance an important factor in deciding the allocation of purchases among suppliers. The evaluation of individual component and overall supplier performance is formalized by the use of rating formula to provide a quantitative and comparative measure of competitiveness.
This section defines the supplier performance rating system, which applies to manufacturers, secondary service providers and distributors. The rating factors are the five categories of supplier performance: delivery, lead time, cost, quality, and service and support. An index is computed for each one on a quarterly basis. The matrix that follows lists the five categories of supplier performance and the minimum indices to be maintained by the supplier:
| Category |
Wt. Factor |
Unit of Measure |
Index (min.) |
| Delivery |
.2 |
% on time (-5 to +3 days) |
75% |
| Lead Time |
.2 |
Days |
75% |
| Cost |
.2 |
PPV Rate |
75% |
| Quality |
.2 |
% of total possible |
75% |
| Service & Support |
.2 |
Subjective Rating |
75% |
Categories of Performance and Index Formula
Product Quality
The product quality index is computed from the total $'s of parts/material received or number of pulls minus total $'s of rejected parts/material received or number of pulls multiplied by a fixed factor of 50 which is based on the premise of 98% defect free quality equals to zero divided by the total $'s of parts/material received or number of pulls multiplied by the quality weight factor of 20%.
Delivery
The delivery index is computed from the Quantity of material/parts received or number of pulls minus quantity of late material/parts received or number of pulls multiplied by a fixed factor based on the premise of 80% equals to zero divided by the Quantity of material/parts received or number of pulls multiplied by the delivery weight factor of 20%. Top
Cost As with our customers, Electro Scientific Industries seeks out products and services that provide maximum value at the lowest overall cost. In order to continue its leadership role in the global marketplace, Electro Scientific Industries must provide products that are cost-competitive. The cost rating is a function of quarterly purchase price variance (PPV)
Service and Support
Electro Scientific Industries is very responsive to its customers when special needs arise and expects similar focus from its suppliers. ESI evaluates and provides a subjective rating of each supplier's service and support. The rating includes individual scores on Service Support and Technical Alignment. The scores are assigned on a scale from 1 to 3, with 3 being the top score. The scores will be decided by the Commodity Manager with input from Procurement, SQE, Field Service, Production and Engineering.
| Scoring |
On Time Delivery |
Lead Time |
PPV Rate |
Reject Rate |
| 3 |
95% to 100% |
0 to 25 days |
-100% to 0% |
0% to 3% |
| 2 |
85% to 95% |
26 to 74 days |
0% to 5% |
3% to 10% |
| 1 |
0 to 85% |
75 to 99 days |
5% to 100% |
11% to 100% |
Performance Rating Notification
The ESI Commodity Manager distributes the performance rating report to suppliers on a quarterly basis and at each Quarterly Business Review (QBR). The report provides the following information:
- A current qualification rating computed from the most recent scorecard.
- A composite supplier performance rating (all parts combined) for each of the five categories.
- A composite graph listing monthly and qurterly defect rates along with job issues. There is also a breakdown of failure categories and failed parts.
- A list of all non-conforming and early/late shipments of lots received within the rating period.
Note: A certified supplier's failure to meet or exceed individual part or composite performance ratings of 75 shall warrant a probationary period for the following quarterly period. During such time, the supplier shall provide remedial and long-term corrective action to achieve 75 or better on the next performance rating report. Top
|