Initial Evaluation of Suppliers

XYZ Company has set up an initial evaluation system and collected data of its three potential suppliers. The company
has taken eight categories of evaluation factors with more than one sub categories of each of the category. It also
assigned weight for each of the category and sub-category. Data were collected for each sub-category on a 5-point
scale and shown in the following table.

Score (5 Pt scale)
Weight
Category Weight Company Company Company
Subcategory
  A B C
1. Quality Systems   20        
Quality commitment     8 3 4 3
             
2. Management Capability   10        
Management/labor relations     5 3 3 4
3. Financial Condition   10        
Debt structure     5 4 4 5
Turnover ratios     5 3 4 4
             
4. Cost Structure   15        
Costs relative to industry     6 4 4 3
Understanding of costs     4 3 5 4
Cost control/reduction efforts     5 5 4 4
             
5. Delivery Performance   15        
Performance to promise     5 3 5 4
Lead-time requirements     5 4 4 3
Responsiveness     5 3 4 2
             
6. Technical/Process Capability   15        
Product innovation     5 4 4 3
Process innovation     4 5 4 2
Research and development     6 3 5 3
             
7. Information Systems Capability   5 3 4 4 5
8. General   10        
Environmental compliance     3 3 5 2
Supplier’s supply base management     5 4 4 3

Evaluate and find which company will be selected initially for supplying materials.
 Weight Company - Score (5 Pt scale)
Category Weight
Subcategory A B C
1. Quality Commitment 15 4 3 4
2. Management Capability 10 10 3 4 3
3. Financial Condition 10        
Debt structure   4 3 5 4
Turnover ratios   6 4 4 4
4. Cost Structure 15        
Costs relative to industry   9 4 3 5
Cost control/reduction efforts   6 5 4 4
5. Delivery Performance 20        
Performance to promise   8 3 4 5
Lead-time requirements   5 4 3 4
Responsiveness   7 3 4 4
6. Technical/Process Capability 15        
Product/process innovation   6 4 3 4
Research and development   9 3 3 5
7. Information Systems Capability 5 4 5 4
8. Environmental compliance 10  3 2 5