Towards a Quantitative Performance Measurement Model in a Buyer-Supplier Relationship Context

Abstract

In the current industrial context, it is generally difficult for manufacturing companies to produce all the components of the products they propose. Thus, they either buy a large proportion of these components from suppliers or subcontract their manufacturing with other companies. This exchange of physical and informational flows between buyers and suppliers is then considered as a network. In terms of manufacturing and logistics, this network can be seen as a Supply Chain (SC) which connects the ultimate customer (buyer) to the ultimate supplier (Ayers, 2000) (Barut et al., 2002). On the other hand, the SC management requires an effective cooperation between suppliers and buyers. In this sense, the whole SC from raw material suppliers to the final customer can be seen as a set of buyersupplier relationships. It means that the buyer-supplier relationship is the cornerstone of the SC management (Kelle et al., 2007). One important point in the SC management concerns the measurement of the performance (Gunaserakan et al., 2008). Indeed, according to Deming’s wheel, SC management requires performance indicators which handle: • on the one hand the objectives, to be defined consistently with the capabilities of the considered system, • on the other hand the measures of the achievement of the assigned objectives, in order to asses the achieved improvement and define the next actions to implement. The performance measurement remains a difficult problem for companies as well as SC’s. We choose here to subscribe to the performance vision based on the ISO 9000 standard. In this sense, the current scorecards generally collect sets of performance measurements about the main processes of the SC, usually according to the SCOR model (SCOR, 2000). Nevertheless, the question of the overall performance resulting from the process performances is rarely considered. Indeed, performance indicators are associated to each process. However, the provided performances are independently defined, as each process is evaluated separately from the others. This partitioned vision does not allow to consider SC as a whole and thus to efficiently control it. In this sense, the involved indicators must be supplemented by the knowledge of the links between them. Therefore, the interest for an overall performance expression for all or a part of the SC is acknowledged, as is the case for