The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1741-0401.htm

Performance
Analyzing the performance of supplier
of supplier development: development
a case study
Sudeep Kumar Pradhan and Srikanta Routroy 209
Mechanical Engineering Department,
Received 30 September 2012
Birla Institute of Technology & Science, Pilani, India Revised 5 February 2013
24 May 2013
Accepted 28 May 2013
Abstract
Purpose – The first objective of this paper is to identify the critical success factors (CSFs) and their
corresponding key performance indicators (KPIs) for supplier development (SD) in a manufacturing
environment. The second objective is to develop a methodology to analyze and evaluate the performance
for SD using CSFs and their KPIs over the time.
Design/methodology/approach – In all, 13 CSFs and their corresponding KPIs for SD are established
through an extensive literature review, discussion held with managers/engineers in different Indian
manufacturing companies and conducting brainstorming sessions. A methodology is proposed using
analytic hierarchy process (AHP) and performance value analysis to assess and evaluate the performance
of SD over the time.
Findings – From an extensive analysis of the results, under the given circumstances, the growth of
SD performance is positive at different progressive points along the time horizon.
Research limitations/implications – This study has not been statistically validated in manufacturing
supply chain for complete acceptability.
Practical implications – This study provides insights into the performance evaluation of SD using
CSFs and their corresponding KPIs. The managers should capture their manufacturing environment which
can reflect their own priority considerations to establish the impact of each KPI on its corresponding CSF.
Originality/value – Although many issues related to SD have been widely researched individually,
few studies have been reported with a model to quantify, monitor, analyze, and evaluate the growth of
SD performance in manufacturing environment in Indian context. The proposed model has the ability
to capture the performance along KPIs and CSFs to draw fruitful conclusions regarding the success of
the SD programme.
Keywords Supply chain, Performance measures, Performance appraisal, Analytical hierarchy process,
Key indicators
Paper type Case study

1. Introduction
The interdependence of manufacturers and suppliers has increased dramatically in
modern business (Sharma and Kodali, 2008). Manufacturers are focusing on their
core competencies and outsourcing non-core activities to a greater extent to achieve
competitive advantage. Because of this practice, organizations are experiencing longer
and more integrated supply chains which are more uncertain, dynamic, and prone
to accidents as one link affects other links in the value chain and this leads to increases
in the supply chain vulnerability (Svensson, 2000; Christopher et al., 2002). Hence,
effective supplier management must be in place to ensure better coordination and
enhanced performance along the supply chain. Supplier development (SD) is one key International Journal of Productivity
element of supplier management (Seuring and Müller, 2008) in which a manufacturer and Performance Management
Vol. 63 No. 2, 2014
improves the supplier’s capability via supplier integration for mutual benefits. Supplier pp. 209-233
r Emerald Group Publishing Limited
integration was found to be positively influenced by a continuous SD programme 1741-0401
along with collaborative supplier capabilities, and supplier quality mindset in Chinese DOI 10.1108/IJPPM-09-2012-0106
IJPPM manufacturing firms (Lockström and Lei, 2012). Manufacturers have shown a strong
63,2 interest to adopt SD programmes for improving supplier performance and achieving
competitive advantage (Li et al., 2012). The performance outcomes derived from the SD
programme may be classified along three dimensions (i.e. supplier performance, buyer
competitive advantage, and buyer-supplier relationship improvement) (Li et al., 2012).
SD programme is also aimed at strengthening relationships with key suppliers so
210 that the risk of opportunistic behavior will be limited (Chiang et al., 2012). Many
manufacturing companies world-wide such as Walmart (Wagner, 2011), Sony (Morris,
1991), Honda of America (Hartley and Jones, 1997), Chrysler (Hartley and Jones, 1997;
Talluri et al., 2010), Ford (Talluri et al., 2010), General Motors (Talluri et al., 2010),
General Electric (Hartley and Jones, 1997; Talluri et al., 2010), Nissan in Japan (Sako,
2004), Toyota in Japan (Sako, 2004), Honda in Japan (Sako, 2004), IBM (Handfield et al.,
2000), Motorola (Port et al., 1990), Visteon Corporation (Chandrasekaran, 2010), John
Deere (Hartley and Jones, 1997), HP (Sharma, 2010), Maruti Udyog (Chandrasekaran,
2010; Aggrawal, 2007), National Grid Company (UK) (McGovern and Hicks, 2006),
Dell (Williams and Moore, 2007), and Whirlpool (Trent and Llewellyn, 2009)
have adopted the SD approach in order to enhance the capabilities of suppliers and
improve supply chain performance. It is essential for a supply chain manager in the
manufacturing environment to keep a track on the progress of the SD programme on a
real time basis. Therefore, the degree of supplier improvement along different
dimensions due to the SD programme at different periods should be evaluated and
must be quantified so that the manufacturer will get a true picture of what is really
happening. If the performance outcomes are not as per expectation, then root cause
analysis may be carried out to identify the reasons behind the discrepancy. Thereafter,
the appropriate action plan should be designed and implemented to bring the SD
programme to the right track. But not many studies have been reported to date to
quantify and evaluate the degree of SD programme success. Many researchers pointed
out that a SD programme has a positive impact along various dimensions. But this
impact is not limited to purchasing performance (Wen-Li et al., 2003; Sanchez-
Rodrı́guez et al., 2005) since many other impacts have been reported: incoming material
performance in terms of delivery, flexibility, cost and quality (Hartley and Jones, 1997;
Krause, 1997); financial health (Monczka and Trent, 1991; Morgan, 1993), plant
performance of manufacturer (De Toni and Nassimbeni, 2000); short- and long-term
supplier performance (Arroyo-Lopez et al., 2012; Nagati and Rebolledo, 2013); supply
chain performance (Sharma and Yu, 2012); new technology adoption (Monczka and
Trent, 1991; Morgan, 1993); knowledge transfer (Giannakis, 2008); providing better
service and product quality (Shokri et al., 2010); product design capability (Monczka
and Trent, 1991; Morgan, 1993); enhancing technological capability (Reed and Walsh,
2002); corporate social responsibility capabilities (Lu et al., 2012); and new product
development speed (Wynstra et al., 2012). SD is a long-term, resource-consuming
business activity that requires commitment from both manufacturing firms and
suppliers (Talluri et al., 2010). The optimum use of the resources and efforts is a critical
issue and it should be evaluated on a continuous basis for successful implementation of
the SD programme. This evaluation process should be carried out by capturing the
relative importance of critical success factors (CSFs) and the performance of their
corresponding key performance indicators (KPIs). Therefore, an evaluation
methodology is proposed by combining the analytic hierarchy process (AHP) and
performance value analysis (PVA) (i.e. AHP-PVA). The AHP is used to find the relative
importance of CSFs whereas the PVA is used to capture the performance of KPIs for
SD programmes at different time periods. The salient features of the proposed Performance
evaluation methodology for analyzing the performance of a SD is explained with an of supplier
Indian manufacturing case. The results and managerial implications of the Indian
manufacturing case are also discussed in detail. development
2. CSFs of SD in a manufacturing supply chain
A literature review was carried out on CSFs in SD within manufacturing supply 211
chains. A survey was conducted across different manufacturing organizations (which
include automobile, cement, tyre, gear, and boiler manufacture) in India through a
formal questionnaire. The data is collected from 256 participants (i.e. mostly engineers,
senior engineers, managers, and senior managers from different Indian manufacturing
companies). The discussions were also held with 12 experts during industrial visits in
India. Finally, 13 CSFs (see Table I) were identified for a SD programme in an Indian
context and the details regarding them are discussed below.

CSFs Sources

Proximity to manufacturing base
Long term strategic goal
Supplier status
Project completion experience
Environmental readiness
Direct involvement
Incentives
Innovation capability (supplier)
Top management commitment
(supplier and manufacturer)
Information sharing
External environment
Supplier certification
Supplier’s supplier condition
Sharma et al. (2011); and concluded from the discussion with
experts
Watts and Hahn (1993),, Li et al. (2003, 2012), Humphreys et al.
(2004, 2011), Kannan et al. (2010), Jianjun and Yang (2011),
Eckerd and Hill (2012) and Marksberry (2012)
Kannan et al. (2010), Shokri et al. (2010), Humphreys et al. (2011),
Mahmood et al. (2011), Sharafi and Parvizian (2011),
Wu et al. (2011), Li et al. (2012) and concluded from the
discussion with experts
Mahmood et al. (2011), Wagner (2011), and concluded from the
discussion with experts
Humphreys et al. (2003) and Routroy (2008)
Krause (1997), Krause and Scannell (2002), Wagner (2006, 2010),
Krause et al. (2007), Modi and Marbet (2007), Chidambaranathan
et al. (2009), Kannan et al. (2010),
Shokri et al. (2010), Humphreys et al. (2011), Wu et al. (2011),
Li et al. (2012) and Marksberry (2012)
Giunipero (1990), Krause (1997, 1999), Krause et al. (1998, 2000),
Kannan et al. (2010) and Humphreys et al. (2011)
Carson et al. (1995), Petroni and Panciroli (2002), Verhees and
Meulenberg (2004), Wang and Ahmed (2004), Hult et al. (2004)
and Mao (2007)
Handfield et al. (2000), Li et al. (2003, 2012), Humphreys et al.
(2004, 2011), Kannan et al. (2010)
Leek et al. (2003), Humphreys et al. (2004, 2011), Carr and
Kaynak (2007), Shokri et al. (2010), Jianjun and Yang (2011),
Liao et al. (2011), Mahmood et al. (2011), Sharma et al. (2011),
Wagner (2011), Wu et al. (2011), Eckerd and Hill (2012),
Li et al. (2012), Lu et al. (2012) and Marksberry (2012)
Dyer and Ouchi (1993), Oh and Rhee (2008), Large and
Thomsen (2011) and Fu et al. (2012)
Carr and Pearson (1999), Krause et al. (2000), Modi and
Marbet (2007), Kannan et al. (2010), Shokri et al. (2010), Table I.
Humphreys et al. (2011), Sharma et al. (2011) and Wu et al. (2011) Critical success factors
Concluded from the discussion with experts of supplier development
IJPPM Proximity to manufacturing base
63,2 This indicates the proximity of the supplier to the manufacturing base. It is associated
with accurate and on-time information visibility. Many experts have argued that
proximity to manufacturing base will not only help in quick implementation of a SD
programme but also the SD programme can be monitored with ease.

212 Long-term strategic goal

This indicates the mutual recognition of each partner’s (i.e. supplier and manufacturer)
commitment to strategic perspectives. The SD programme implementation is a long-
term joint plan of both, and the success of it depends on their involvement and the
positive attitude of both towards this programme. The experts also agreed that this be
considered as a CSF of a SD programme.

Supplier status
This indicates the financial position, openness, and competence of the supplier. In
many situations, the supplier status is mentioned as the basic input and prerequisite
for the manufacturer to consider a supplier for development. Similar remarks are
recorded from experts during the discussion with them.

Project completion experience

This indicates the past performance record of the supplier in terms of reliability in
completing the projects on time with the manufacturer and its different clients. This is
also identified from the experts’ opinions and is considered as a CSF of SD.

Environmental readiness (ENR)

The ENR indicates the present green capability; the degree of eagerness towards
enhancing the green ability in different directions in future and the performance
measurement system for monitoring the green performance. This factor will play a
significant role in future business survival and achieving competitive advantage.

Direct involvement
This indicates the level of involvement/investment of manufacturer in such as the
supplier’s workforce, its research development or its capital resources in order to
enhance the supplier’s performance and create a win-win environment in the long
run. It has been considered as a CSF by many researchers and it was also concluded
from the experts’ opinions.

Incentives
The manufacturer should motivate and encourage the supplier for his different efforts
that lead to successful implementation of the SD programme. This is possible through
incentive plans. The incentive plans should be designed by the manufacturer and
should be implemented in consultation with the supplier. This point is concluded from
experts’ opinion and the literature. Therefore, it was considered a CSF.

Innovation capability (supplier)

The innovative capabilities (supplier) not only include traditional competencies in
R&D and product/process but also capabilities supportive of innovation and
managerial practices. Such capabilities should be enhanced due to the SD programme
across time in order to achieve competitive advantage. Therefore, suppliers having
innovative capabilities attract the manufacturer to include them in the SD programme. Performance
The CSF was supported by both from experts’ opinion and the literature. It is therefore of supplier
included in the CSF list.
development
Top management commitment (manufacturer and supplier)
Top management commitment within both manufacturer and supplier is a prerequisite for
developing a SD as it is a long-term programme and requires investment which may be in 213
terms of infrastructure, research and development, training, and so on. It is considered as
a significant factor in SD programme development and is included in the CSF list.

Information sharing
Manufacturer and supplier should effectively communicate each other through
relevant and detailed information sharing on a real time basis to avoid the information
distortion and to enhance supply chain coordination. It plays an important role in
success of an SD programme. Therefore it is considered as a CSF for SD programme.

External environment
It represents the technological and competitive business environment. These
environments are dynamic in nature. Manufacturer always wants to have supplier
which has the attitude and capability to handle it effectively and efficiently so that
competitive advantage can be maintained. These capabilities should be enhanced due
to SD programme across the time. Therefore, it is included in the CSF list.

Supplier certification (SUC)

SUC whether by the manufacturer or third party always brings more confidence for the
manufacturer to continue business with the supplier. The supplier should put effort in
to acquiring quality certification through the SD programme and its certification level
should improve over time. Therefore, it is considered as a CSF for SD.

Supplier’s supplier condition

The supplier may outsource many components/parts/services to its suppliers. Therefore,
the supplier’s suppliers’ condition in terms of technical capability, financial stability,
reputation, delivery time performance, quality performance, flexibility performance, and
so on has to be improved to enhance the capability of the supplier. Therefore, it is
considered as a CSF of SD.

3. Proposed methodology for evaluating a SD programme

Many issues related to SD have been widely researched individually, but few studies
have been reported with a model to quantify, monitor, analyze, and evaluate the growth
of SD performance in the manufacturing environment. Bai and Sarkis (2011) introduced
a multi-stage methodological approach for evaluating a SD programme in an organization
using grey systems and rough set theories. This issue was discussed with Indian
managers during our industrial visits to a number of Indian manufacturing companies
and their remarks are recorded. We found that prioritization of CSFs and performance
of their corresponding KPIs is critical and should be captured to evaluate the
performance of the SD programme. The AHP and PVA algorithm can be combined to
prioritize the attributes (i.e. CSFs) initially and then capture both prioritization value of
CSFs and the performance of KPIs along each CSF to evaluate the performance of
a system at the later stage. Routroy (2009a) combined the AHP and PVA algorithm to
IJPPM evaluate a third party logistics provider and Routroy and Pradhan (2012) also
63,2 combined the AHP and PVA algorithm to select suppliers in a green manufacturing
environment. A methodology is proposed on the basis of the remarks of managers
and combining the AHP and PVA algorithm to evaluate the performance of the SD
programme in a manufacturing environment. The flow chart of the proposed
SD evaluation methodology is developed in consultation with managers and shown in
214 Figure 1. A cross-functional team should be formed at the company level where SD
evaluation has to be carried out. The cross-functional team should identify and finalize
the relevant CSFs which are appropriate and relevant to a specific manufacturing
environment. The performance of CSFs has to be measured over time for the supplier
and the CSFs mentioned in Table I may be taken as reference. For each CSF, a set of
KPIs has to be identified. The weightage of each KPI is required for further analysis.
AHP is proposed for prioritization and determination of weightage of all KPIs as it has
the capability to capture both quantitative and qualitative factors. It also has capability
to check the consistency of judgement. The details regarding the prioritization
and determination of weightage of all KPIs using AHP are mentioned in Section 3.1.

Cross-functional team formation

Conduct brainstorming sessions

Select the relevant CSFs

Develop KPIs for each CSF

Determine the weightage of each KPI by AHP

Select the supplier

Decide duration gap for evaluation

Set optimum performance value for each KPI

efforts to reach the desired

Set new goal

Measure the performance of SD programme

Put optimum increased

using PVA
performance value

Perform gap analysis

Yes
Whether desired
performance achieved?

Figure 1. No
Flow chart for proposed
supplier development
evaluation methodology Root cause analysis for under performing CSFs
Once weightage of KPIs are established, then the supplier has to be selected for Performance
performance evaluation. The cross-functional team will decide the period over which of supplier
the SD performance evaluation should be carried out on the basis of internal and
external constraints and environment. The performance level of each KPI that is development
feasible and attainable is fixed taking inputs from supplier comparative analysis,
supplier environment, and considering the opinion of cross-functional team. This
performance level for each KPI is referred to as the desired performance level of each 215
KPI. The duration in which the desired performance value for each KPI will be
achieved has to be identified. It may not be same for all KPIs. The PVA is proposed as it
has the capability to capture both quantitative and qualitative KPIs to evaluate the
performance of SD programme at different periods and the relative importance of
CSFs. The PVA algorithm is discussed in Section 3.2. Once the performance of the SD
programme is calculated, a gap analysis should be carried out to find the gap that
exists between the supplier which has undergone the development programme and the
desired performance value at different points in time. If the supplier is found to have
reached the desired performance value along a KPI, then a new goal has to be set for
that KPI. Otherwise (i.e. if the desired value is not achieved) the root cause analysis
may be carried out to identify the reasons behind the shortfall. The required increased
efforts should be estimated for each identified underperforming KPI to reach the
desired performance value in minimum possible and feasible time.

3.1 Development of AHP to prioritize KPIs

AHP was developed in 1972 as a practical approach to solving relatively complex
problems (Saaty, 1980). It is used for multi-criteria problems in a number of application
domains (Roger, 1987; Partovi, 1994; Saaty, 2000; Kodali and Chandra, 2001; Kodali and
Routroy, 2005; Routroy, 2008, 2009b; Routroy and Pradhan, 2012, 2013). The step-by-
step algorithm used in this paper is shown below:
. Step 1. Develop two level hierarchies with the first level as CSFs and KPIs as the
second level.
. Step 2. Construct a set of pair-wise comparison matrices for CSFs. The CSFs should
be compared among themselves and should be prioritized first on the basis of the
inputs like supply chain strategy; product design strategy; internal constraints;
type of organization; organizational culture; reasons to outsource; reasons to SD,
and, etc. to determine their degree of impact (i.e. prioritization value) on SD. This
yields a square matrix of judgements. A scale of 1 to 9 as shown in Table II is used

Intensity of importance Definition and explanation

1 Equally important
2 Equally to moderate more important
3 Moderately more important
4 Moderate to strong more important
5 Strongly more important
6 Strong to very strong more important
7 Very strongly more important
8 Very to extremely strongly more important
9 Extremely more important Table II.
Scale for pair-wise
Source: Saaty (1980) comparisons
IJPPM for pair-wise comparisons. The pair-wise comparisons are done in terms of which
63,2 an element dominates another. These judgements are then expressed as integers.
If “CSF A” dominates over “CSF B”, then the whole number integer is entered in
row “CSF A”, column “CSF B” and the reciprocal is entered in row “CSF B”, column
“CSF A”. If the CSFs being compared are equal, a one is assigned to both positions.
. Step 3. The performance indicators in the second level are then compared to each
216 other based on their effect on the governing member in first level.
. Step 4. The pair-wise comparisons across CSFs and PIs have to be calculated and
then, the consistency is determined using the eigenvalue. To do so, normalize the
column of numbers by dividing each entry by the sum of all entries. Then sum each
row of the normalized values and take the average. This provides principal vector
(PV). The check of the consistency of judgements is as follows:
1 Let the pair-wise comparison matrix be denoted M1 and PV be denoted M2.
Then define M3 ¼ M1  M2 and M4 ¼ M3/M2.
lmax ¼ average of the elements of M4.
consistency index (CI) ¼ (lmaxN)/N1.
consistency ratio (CR) ¼ CI/RI corresponding to N.
where RI: random CI (see Table III) and N: Number of elements.
1 If CR is o10 per cent, judgements are considered consistent. And if CR is
410 per cent, the quality of judgements should be improved to have CR p10
per cent.
. Step 5. Step 2 and Step 3 are performed for each CSF to have relative importance
value. They are also applied to each set of PIs for a CSF level to determine their
relative importance value.
. Step 6. The absolute prioritization value of each performance indicator is
calculated by multiplying its relative importance with the respective relative
importance value of its CSF.
3.2 Development of PVA to measure the performance of SD programme
The PVA is a revised version of utility value analysis. D’angelo et al. (1996a, b)
discussed PVA algorithm. It is used for multi-criteria problems in a number of
application domains (D’angelo et al., 1996a, b; Kodali and Sangwan, 2004; Kodali and
Routroy, 2006). The step-by-step algorithm used in this paper is shown below:
. Step 1. Set durations at which the SD performance (ai) will be evaluated.
. Step 2. Classify the PIs into direct (performance grows while measure
increases) and indirect categories (performance grows while measure
decreases).
. Step 3. Form the performance matrix, i.e. co-efficient eij related to the performance
indicator cj ( j ¼ 1, 2, y, J ) and the ai (i ¼ 1, 2, y, I).

N 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

RI 0 0 0.58 0.9 1.12 1.24 1.32 1.41 1.45 1.49 1.51 1.48 1.56 1.57 1.59
Table III.
Random index table Source: Saaty (2001)
 . Step 4. Quantify the qualitative attributes using the scale of 1 to 10, where 1 Performance
means very low, 3 means low, 5 means medium, 7 means high, 9 means very of supplier
high, and 10 means excellent.
. Step 5. Form the normalized performance matrix. It is transforming the initial
development
performance measure in a score/weight for easier interpretation based on the
value function fj for each performance indicator (cj) as follows:
1 Direct category (when performance increases while measure increases): 217
eij
pij ¼
maxðej Þ
for each ai related to attribute cj
1 Indirect category (when performance grows while measure decreases):
minðej Þ
pij ¼
eij
for each ai related to attribute cj.
. Step 6. Obtain the relative weightage Wj for each performance indicator (cj)
(derived from AHP in Step 5).
. Step 7. Obtain partial performance measure Zij by multiplying relative
weightage Wj of attribute/criterion/performance indicator to each of its row
members (alternatives), i.e. pij as: partial performance of jth attribute:
Zij ¼ pij Wj (i ¼ 1, 2 y I)
. Step 8. Aggregate the partial performance measures for each alternative as: total
performance value (Ni) of alternative ai is the sum of Zij:
X
J
Ni ¼ Zij
j¼1

. Step 9. Analyze the SD performance (ai) at different duration.

4. Evaluating the performance of SD using the proposed methodology for

an Indian manufacturing company
The proposed SD evaluation methodology is applied to a leading Indian manufacturing
company “XYZ” (the name “XYZ” is used for confidentiality purposes). The company is
diversified in nature. It is working in a “make to order” environment and producing
products which are critical to many multi-national companies spread across the globe.
The company turnover is around 10,000 cores rupees annually and more than 1,000 are
engaged in the workforce. The company already has a good reputation in the market
with a good brand name. Human resource is somewhat problematic in many functional
areas. The organization is focusing on its core activities and wants to outsource
non-core activities if it is possible. The company has an excellent supply chain and
its supply chain strategy is more inclined towards responsiveness. The company has
developed a flexible outsourcing capability in order to achieve competitive advantage.
It outsources almost 50 per cent of its total project cost from many forms. It has more
than 100 suppliers among which 25 suppliers are considered as tier 1 suppliers for
different types of components/service/sub-assembly. The company has been involved
in SD for approximately three years due to future opportunity in the business, supplier
IJPPM environment, and the status of suppliers. The top management was interested to
63,2 evaluate the SD programmes which were carried out with a number of suppliers.
The SD evaluation methodology was applied to a SD programme that is carried out
with the supplier “ABC” (the name “ABC” is used for confidentiality purposes). The
supplier “ABC” was supplying components of low value and high criticality. The supplier
“ABC” had already been involved in the SD programme for 18 months. The proposed
218 SD evaluation methodology is applied to evaluate the SD programme. But the
proposed evaluation methodology can be applied to other SD programmes which were
carried out with a number of suppliers to know the overall performance improvement
of supplier along different CSFs and their overall growth of performance across
different time periods. A cross-functional team comprising of engineers, senior
engineers, and managers from different departments was formed. A brainstorming
session was conducted to identify the CSFs that were relevant to the case environment.
It was concluded that the identified 13 CSFs (shown in Table I) for evaluating the SD
programme in Indian context were appropriate and relevant to the case environment.
The KPIs for each CSF was identified with the consultation of the cross-functional
team and are presented in Table IV. The importance of each CSF was found out relative
to other CSFs on a scale of 1-9 considering its outsourcing environment and opinion of
cross-functional team. The issues like supply chain strategy; product design strategy;
internal constraints; type of organization; organizational culture at both ends;
component value; component criticality; and reasons to outsource were considered in
the outsourcing environment. It was decided to collect the performance of each KPI at
the start of the SD programme, end of sixth month, end of 12th month and end of 18th
month. The desired performance value along each KPI was fixed considering the supplier
comparative analysis and supplier environment. The performance of the supplier at the
four different points was evaluated and compared with the desired performance value for
gap analysis. The root cause analysis for underperforming CSFs and KPIs was carried
out and it formed the basis for fixing the new desired performance value for the KPIs and
CSFs in consultation with the cross-functional team.

5. Results and discussion

The proposed SD evaluation methodology is applied to measure, monitor, analyze,
and evaluate the performance SD programmes between the manufacturing company
“XYZ” and the supplier “ABC”. The process of the proposed approach begins with
the identification of CSFs (see Table I) and their corresponding KPIs (see Table IV).
The CSFs pair-wise comparison matrix (see Table V) was developed in consultation
with the cross-functional team. The normalized weightage of CSFs was evaluated
using user-friendly developed AHP software and is shown in Table VI. The matrix
has CR of 0.030520. This indicates that judgements made are consistent as CR is
o0.1. The KPI normalized weightage matrix for each CSF was also calculated.
The KPI normalized weightage matrix for “long-term strategic goal” is shown in
Table VII and CR is 0.00636. This indicates that judgements made were consistent as
CR is o0.1. Similarly KPI normalized weightage of other CSFs is determined and
their CR values indicate consistency. The relative weightage of each KPI was
evaluated and is mentioned in Table VIII on the basis of normalized weightage of
CSF and normalized weightage of KPI. The performance of the SD along all KPIs at
the four points and their nature (i.e. direct or indirect) is shown in Table IX. The
desired performance value of all KPI was also fixed and presented in Table IX. These
data are captured using user-friendly developed PVA software. The normalized
CSF NCSF PIs NPI
Performance
of supplier
Proximity to manufacturing base PMB Procurement lead time
Variability in lead time
PLT
VLT
development
Flexibility in reach FIR
Long term strategic goal LSG Level of supplier capability LSC
enhancement
Level of supplier flexibility LSF
219
enhancement
Level of supplier reliability LSR
enhancement
Degree of supplier quality LSQ
enhancement
Level of reduction in cost LRC
Level of reduction in fixed assets LRF
Supplier status SUS Financial strength FIS
Workforce strength WOS
Technical ability TEA
Risk taking ability RTA
Project completion experience PCE Project duration against competitor PAC
On-time performance OTP
Volume of projects handled in VPT
a given time
Number of projects handled NPH
Variety of projects handled VPH
Environmental readiness ENR Amount of energy use in comparison AEU
to competitor
Level of clean energy LCE
Amount of material use AMU
Degree of recycling and reuse DRR
Design for environment DFE
Environmental management system EMS
Waste disposal and management system WDM
Direct involvement DIN Number of specialized training NST
programme conducted
Level of investment LOI
Level of knowledge transfer LKT
Number of site visits NSV
Incentives INC Level of product/service value LOP
Meeting the targets in terms of MTT
quantity, quality and delivery
Achieving certifications/rewards/ CRR
recognitions
Innovation capability (supplier) INN Research and development capability PDC
Performance on innovation reputation PIR
Attitude towards innovation ATI
Top management commitment TMC Level of involvement LOI
(supplier and manufacturer) Specialized team formation STF
Depth and frequency of review on DFR
progress of SD
Information sharing INS Information infrastructure INI
Information accuracy INA Table IV.
Information timeliness INT CSFs and their KPIs for
SD for the case
(continued) environment
IJPPM CSF NCSF PIs NPI
63,2
External environment EEN Demand uncertainty handling DUH
Technology uncertainty handling TUH
Level of competitive advantage LCA
Supplier certification SUC Quality level QUL
Green ability GRA
220 Level of reputation LOR
Supplier’s supplier condition SSC Financial stability FIS
Capability in terms of capacity CTC
Research and development facility RDF

Table IV. Note: NCSF, notation of CSFs; NPI, notation of PI

performance and partial performance measures of each KPI for the four periods were
evaluated and are given in Tables X and XI, respectively. The desirability
performance index (DPI) along four periods were also evaluated and
provided in Table XII. The DPI values at the start of SD programme, end of the
sixth month, end of 12th month, and end of 18th month were 0.348, 0.493, 0.664,
and 0.792, respectively. The results show that the performance of the supplier
is only 34.8 per cent of the desired performance just before the start of SD programme
and a continuous growth of supplier performance is achieved with respect to time
after the SD programme is implemented. The overall performance of the SD
programme at the end of 18th month reached 79.2 per cent of the desired
performance value which is more than twice the value just before the start of the SD
programme. This indicates that the SD programme was successful, but still
improvement is expected along many KPIs. The aggregated indices for the four
periods along each CSF are shown in Table XII. The result also indicates that
improvement along CSF is achieved with time but the growth of improvement is not
same along all CSFs. On the basis of the performance improvement, the CSFs are
classified into three categories (i.e. perfectly achieved category; desirably achieved
category, and somewhat achieved category). The CSFs, i.e. top management
commitment and information sharing are included in perfectly achieved category.
These CSFs have achieved their desired performance value as aggregate indices are 1
at the end of the 18th month for both these CSFs. The new performance level (goal)
may be set for these CSFs provided that it is feasible and economically justified.
The CSFs ENR and SUC are put in the desirably achieved category as those have
not achieved the desired performance value but are very close to it. The aggregate
indices were 0.904 and 0.9 at the end of the 18th month for both ENR and SUC,
respectively. These CSFs were discussed in detail by the cross-functional team and
it is believed that these CSFs will get to the desired value in another six months.
Therefore, no extra effort needed to be put in to these CSFs. The rest of the
nine CSFs are included in somewhat achieved category as their performance values
were far from desired performance value. The aggregate indices are 0.717, 0.729,
0.717, 0.777, 0.778, 0.7, 0.779, 0.782, and 0.714 at the end of the 18th month for PMB,
LSG, SUS, PCE, DIN, INC, INN, EEN, and SSC CSFs, respectively. Therefore,
it is suggested that a cause effect analysis should be conducted for all nine CSFs
of this somewhat achieved category to find out the reasons for not achieving the
desired performance value. It is also suggested that as the company is working in
 PMB LSG SUS PCE ENR DIN INC INN TMC INS EEN SUC SSC SUM PV

PMB 0.159 0.131 0.204 0.19 0.18 0.151 0.19 0.17 0.173 0.183 0.178 0.171 0.194 2.27 0.175
LSG 0.318 0.263 0.245 0.21 0.22 0.301 0.23 0.213 0.259 0.244 0.2 0.195 0.226 3.13 0.24
SUS 0.032 0.044 0.041 0.05 0.04 0.05 0.04 0.043 0.043 0.03 0.044 0.049 0.032 0.54 0.041
PCE 0.02 0.029 0.02 0.02 0.02 0.038 0.02 0.021 0.022 0.015 0.022 0.024 0.016 0.29 0.022
ENR 0.04 0.053 0.041 0.05 0.04 0.05 0.04 0.043 0.043 0.03 0.044 0.049 0.032 0.56 0.043
DIN 0.159 0.131 0.122 0.1 0.13 0.151 0.19 0.17 0.173 0.183 0.178 0.171 0.194 2.05 0.158
INC 0.032 0.044 0.041 0.05 0.04 0.03 0.04 0.043 0.043 0.03 0.044 0.049 0.032 0.52 0.04
INN 0.04 0.053 0.041 0.05 0.04 0.038 0.04 0.043 0.043 0.03 0.044 0.049 0.032 0.54 0.042
TMC 0.079 0.088 0.082 0.1 0.09 0.075 0.08 0.085 0.086 0.122 0.089 0.098 0.097 1.16 0.089
INS 0.053 0.066 0.082 0.1 0.09 0.05 0.08 0.085 0.043 0.061 0.067 0.073 0.065 0.9 0.07
EEN 0.02 0.029 0.02 0.02 0.02 0.019 0.02 0.021 0.022 0.02 0.022 0.024 0.016 0.28 0.021
SUC 0.023 0.033 0.02 0.02 0.02 0.022 0.02 0.021 0.022 0.02 0.022 0.024 0.032 0.3 0.023
SSC 0.027 0.038 0.041 0.05 0.04 0.025 0.04 0.043 0.029 0.03 0.044 0.024 0.032 0.46 0.036
Notes: CI ¼ 0.047611; CR ¼ 0.030520
of supplier
development

matrix
Performance

Critical success factors

Table V.

pair-wise comparison
221
IJPPM PMB LSG SUS PCE ENR DIN INC INN TMC INS EEN SUC SSC
63,2
PMB 1 0.5 5 8 4 1 5 4 2 3 8 7 6
LSG 2 1 6 9 5 2 6 5 3 4 9 8 7
SUS 0.2 0.167 1 2 1 0.334 1 1 0.5 0.5 2 2 1
PCE 0.125 0.111 0.5 1 0.5 0.25 0.5 0.5 0.25 0.25 1 1 0.5
222 ENR 0.25 0.2 1 2 1 0.334 1 1 0.5 0.5 2 2 1
DIN 1 0.5 3 4 3 1 5 4 2 3 8 7 6
INC 0.2 0.167 1 2 1 0.2 1 1 0.5 0.5 2 2 1
INN 0.25 0.2 1 2 1 0.25 1 1 0.5 0.5 2 2 1
TMC 0.5 0.334 2 4 2 0.5 2 2 1 2 4 4 3
INS 0.334 0.25 2 4 2 0.334 2 2 0.5 1 3 3 2
Table VI. EEN 0.125 0.111 0.5 1 0.5 0.125 0.5 0.5 0.25 0.334 1 1 0.5
Normalized weightage of SUC 0.143 0.125 0.5 1 0.5 0.143 0.5 0.5 0.25 0.334 1 1 1
critical success factors SSC 0.167 0.143 1 2 1 0.167 1 1 0.334 0.5 2 1 1

LSC LSF LSR LSQ LRC LRF SUM PV

LSC 0.26 0.25 0.26 0.29 0.30 0.25 1.61 0.27

LSF 0.05 0.05 0.05 0.05 0.04 0.05 0.29 0.05
LSR 0.26 0.25 0.26 0.29 0.30 0.25 1.61 0.27
LSQ 0.09 0.10 0.09 0.10 0.07 0.12 0.57 0.09
Table VII. LRC 0.07 0.10 0.07 0.10 0.07 0.08 0.48 0.08
Normalized weightage LRF 0.26 0.25 0.26 0.19 0.22 0.25 1.44 0.24
for KPIs of “long-term
strategic goal” Notes: CI ¼ 0.00789033; CR ¼ 0.00636

a dynamic environment, the company should be flexible and update the desired
performance value. It is also concluded that the SD programme considered for
evaluation is on the right track overall.

6. Conclusions
This paper has two objectives. The first objective is to develop a set of CSFs
and their KPIs to evaluate the SD programme. The second objective is to construct
a SD evaluation methodology to quantify, monitor, analyze, and evaluate the
performance of SD programme along different periods. This paper will fill the gap
that exists in the area of SD literature with respect to performance evaluation of
SD programme. A case situation is developed and discussed to demonstrate the
proposed methodology. The proposed methodology requires pair-wise comparisons
for CSFs and KPIs analysis whereas pair-wise comparisons are not required
for alternative analysis. It is observed that while solving the problem of the above
nature, one can find the number of pair-wise comparisons is quite large for
alternative analysis in comparison to both CSFs and KPIs analysis. In the discussed
case situation, 14 pair-wise comparisons (one pair-wise comparison for CSFs and
13 pair-wise comparisons for KPIs) are made for only CSFs and KPIs in order to
calculate the normalized weightage of the KPIs whereas 50 pair-wise comparisons
are required for alternative analysis which are avoided using PVA algorithm.
This methodology implemented for the case environment and the results obtained
NKPI NWKPI NWCSF RWPI NKPI NWKPI NWCSF RWPI
Performance
of supplier
PLT 0.16 0.175 0.028 NST 0.52 0.158 0.0822 development
VLT 0.30 0.175 0.0525 LOI 0.26 0.158 0.0411
EAS 0.54 0.175 0.0945 LKT 0.14 0.158 0.0221
LSC 0.27 0.24 0.0648 NSV 0.08 0.158 0.0126
LSF 0.05 0.24 0.012 LOP 0.54 0.04 0.0216 223
LSR 0.27 0.24 0.0648 MTT 0.30 0.04 0.012
LSQ 0.09 0.24 0.0216 CRR 0.16 0.04 0.0064
LRC 0.08 0.24 0.0192 PDC 0.54 0.042 0.0227
LRF 0.24 0.24 0.0576 PIR 0.16 0.042 0.0067
FIS 0.10 0.041 0.0041 ATI 0.30 0.042 0.0126
WOS 0.18 0.041 0.0074 LOI 0.54 0.089 0.0481
TEA 0.29 0.041 0.0119 STF 0.30 0.089 0.0267
RTA 0.43 0.041 0.0176 DFR 0.16 0.089 0.0142
PAC 0.40 0.022 0.0088 INI 0.54 0.07 0.0378
OTP 0.23 0.022 0.0051 INA 0.30 0.07 0.021
VPT 0.14 0.022 0.0031 INT 0.16 0.07 0.0112
NPH 0.11 0.022 0.0024 DUH 0.63 0.021 0.0132
VPH 0.12 0.022 0.0026 TUH 0.24 0.021 0.005
AEU 0.22 0.043 0.0095 LCA 0.14 0.021 0.0029
LCE 0.04 0.043 0.0017 QUL 0.54 0.023 0.0124
AMU 0.07 0.043 0.003 GRA 0.30 0.023 0.0069
DRR 0.12 0.043 0.0052 LOR 0.16 0.023 0.0037
DFE 0.12 0.043 0.0052 FIS 0.54 0.036 0.0194
EMS 0.22 0.043 0.0095 CTC 0.30 0.036 0.0108
WDM 0.22 0.043 0.0095 RDF 0.16 0.036 0.0058
Table VIII.
Note: NKPI, notation of KPI; NWKPI, normalized weightage for KPI; NWCSF; normalized weightage Relative weightage of key
for CSF; RWKPI, relative weightage KPI performance indicators

indicate that there is a continuous performance growth of the SD programme.

Only two CSFs out of 13 have achieved the desired performance level whereas
remaining 11 CSFs have not reached the desired performance level. But the
degree of difference between actual performance and desired performance
varies along these 11 CSFs. The outcomes of the findings give a clear picture
of the SD implementation and will form the basis of the future action plan.
The findings cannot be generalized for any other manufacturing companies as
it is based on a single case environment, but the proposed approach is applicable for
quantifying, monitoring, analyzing, and evaluating the success of SD programme
in different environments. The managers need to analyze and capture their
manufacturing environments which can reflect their own priority considerations
to establish the impact of each KPI on its corresponding CSF. So, the proposed
methodology can be applied with ease as no special skills are required apart
from knowing own priority concern for different company managers. It is also a time
saving approach. The software for AHP and PVA used in proposed methodology is
readily available or can be programmed with little effort. It is also appreciated
by managers in the case company as the proposed methodology gave a clear
and focused picture on the issue with less effort and skill. The proposed methodology
can be extended to measure the performance of green SD programme in a
manufacturing environment.
IJPPM NKPI NPI CSF PT 1 PT 2 PT 3 PT 4 DP
63,2
PLT . PMB 15 12 11 11 9
VLT . PMB 3 2 2 2 1
EAS m PMB High Very High Very High Very High Excellent
LSC m LSG Medium Medium High High Very High
224 LSF m LSG Medium Medium Medium High Very High
LSR m LSG Low Medium High High Excellent
LSQ m LSG Low Low Medium High Excellent
LRC m LSG Low Low Low Medium High
LRF m LSG Low Low Medium Medium High
FIS m SUS Low Low Medium Medium High
WOS m SUS Low Low Medium Medium High
TEA m SUS Low Low Medium Medium High
RTA m SUS Low Low Medium Medium High
PAC . PCE Medium Medium Medium High Very High
OTP m PCE Low Medium Medium High Very High
VPT m PCE Medium Medium Medium High Very High
NPH m PCE Medium Medium Medium High Very High
VPH m PCE Medium Medium Medium High Very High
AEU . ENR Medium Medium High Very High Excellent
LCE m ENR Medium Medium High Very High Excellent
AMU m ENR Medium High High Very High Excellent
DRR m ENR Medium High High Very High Excellent
DFE m ENR Low Medium High Very High Excellent
EMS m ENR Low Medium High Very High Excellent
WDM m ENR Low Medium High High Excellent
NST m DIN Very low Low Medium High Very High
LOI m DIN Very low Low Medium High Very High
LKT m DIN Very low Low Medium High Very High
NSV m DIN Very low Low Medium High Very High
LOP m INC Low Low Medium High Excellent
MTT m INC Low Low Medium High Excellent
CRR m INC Low Low Medium High Excellent
PDC m INN Very Low Low Medium High Very High
PIR m INN Low Medium Medium High Very High
ATI m INN Low Medium Medium High Very High
LOI m TMC Very low Medium High Very High Very High
STF m TMC Very low Medium High Very High Very High
DFR m TMC Very low Medium High Very High Very High
INI m INS Medium Medium Very High Excellent Excellent
INA m INS Medium Medium Very High Excellent Excellent
INT m INS Medium Medium Very High Excellent Excellent
DUH m EEN Medium Medium High High Very High
TUH m EEN Medium Medium High High Very High
LCA m EEN Medium Medium High High Very High
QUL m SUC Low Medium High Very High Excellent
GRA m SUC Low Medium High Very High Excellent
LOR m SUC Low Medium High Very High Excellent
FIS m FIS Very low Low Medium Medium High
CTC m CTC Very low Low Medium Medium High
Table IX. RDF m RDF Very low Low Medium Medium High
Performance of the SD
at different periods Note: NKPI, nature of KPI; PT, performance at time period; DP, desired performance
NP NPI CSF NPT 1 NPT 2 NPT 3 NPT 4
Performance
of supplier
PLT . PMB 0.028 0.6 0.75 0.818 development
VLT . PMB 0.0525 0.2 0.25 0.25
EAS m PMB 0.0945 0.7 0.9 0.9
LSC m LSG 0.0648 0.5556 0.556 0.7778
LSF m LSG 0.012 0.5556 0.556 0.7778 225
LSR m LSG 0.0648 0.3 0.5 0.7
LSQ m LSG 0.0216 0.3 0.3 0.5
LRC m LSG 0.0192 0.4286 0.429 0.4286
LRF m LSG 0.0576 0.4286 0.429 0.4286
FIS m SUS 0.0041 0.4286 0.429 0.7143
WOS m SUS 0.0074 0.4286 0.429 0.7143
TEA m SUS 0.0119 0.4286 0.429 0.7143
RTA m SUS 0.0176 0.4286 0.429 0.7143
PAC . PCE 0.0088 0.5556 0.556 0.5556
OTP m PCE 0.0051 0.3334 0.556 0.5556
VPT m PCE 0.0031 0.5556 0.556 0.5556
NPH m PCE 0.0024 0.5556 0.556 0.5556
VPH m PCE 0.0026 0.5556 0.556 0.5556
AEU . ENR 0.0095 0.5 0.5 0.7
LCE m ENR 0.0017 0.5 0.5 0.7
AMU m ENR 0.003 0.5 0.7 0.7
DRR m ENR 0.0052 0.5 0.7 0.7
DFE m ENR 0.0052 0.3 0.5 0.7
EMS m ENR 0.0095 0.3 0.5 0.7
WDM m ENR 0.0095 0.3 0.5 0.7
NST m DIN 0.0822 0.1111 0.333 0.5556
LOI m DIN 0.0411 0.1111 0.333 0.5556
LKT m DIN 0.0221 0.1111 0.333 0.5556
NSV m DIN 0.0126 0.1111 0.333 0.5556
LOP m INC 0.0216 0.3 0.3 0.5
MTT m INC 0.012 0.3 0.3 0.5
CRR m INC 0.0064 0.3 0.3 0.5
PDC m INN 0.0227 0.1111 0.333 0.5556
PIR m INN 0.0067 0.3334 0.556 0.5556
ATI m INN 0.0126 0.3334 0.556 0.5556
LOI m TMC 0.0481 0.1111 0.556 0.7778
STF m TMC 0.0267 0.1111 0.556 0.7778
DFR m TMC 0.0142 0.1111 0.556 0.7778
INI m INS 0.0378 0.5 0.5 0.9
INA m INS 0.021 0.5 0.5 0.9
INT m INS 0.0112 0.5 0.5 0.9
DUH m EEN 0.0132 0.5556 0.556 0.7778
TUH m EEN 0.005 0.5556 0.556 0.7778
LCA m EEN 0.0029 0.5556 0.556 0.7778
QUL m SUC 0.0124 0.3 0.5 0.7
GRA m SUC 0.0069 0.3 0.5 0.7
LOR m SUC 0.0037 0.3 0.5 0.7 Table X.
FIS m FIS 0.0194 0.1429 0.429 0.7143 Normalized performance
CTC m CTC 0.0108 0.1429 0.429 0.7143 of the SD at different
RDF m RDF 0.0058 0.1429 0.429 0.7143 periods
IJPPM NKPI NKPI CSF NPT 1 NPT 2 NPT 3 NPT 4 NDP
63,2
PLT . PMB 0.0168 0.021 0.0229 0.0229 0.028
VLT . PMB 0.0105 0.0131 0.0131 0.0175 0.0525
EAS m PMB 0.0662 0.0851 0.0851 0.0851 0.0945
LSC m LSG 0.036 0.036 0.0504 0.0504 0.0648
226 LSF m LSG 0.0067 0.0067 0.0093 0.0093 0.012
LSR m LSG 0.0194 0.0324 0.0454 0.0454 0.0648
LSQ m LSG 0.0065 0.0065 0.0108 0.0151 0.0216
LRC m LSG 0.00822 0.00822 0.00822 0.0137 0.0192
LRF m LSG 0.0247 0.0247 0.0247 0.0411 0.0576
FIS m SUS 0.0018 0.0018 0.0029 0.0029 0.0041
WOS m SUS 0.0032 0.0032 0.0054 0.0054 0.0074
TEA m SUS 0.0051 0.0051 0.0085 0.0085 0.0119
RTA m SUS 0.0075 0.0075 0.0126 0.0126 0.0176
PAC . PCE 0.0049 0.0049 0.0049 0.0068 0.0088
OTP m PCE 0.0017 0.0028 0.0028 0.004 0.0051
VPT m PCE 0.0017 0.0017 0.0017 0.0024 0.0031
NPH m PCE 0.0013 0.0013 0.0013 0.0019 0.0024
VPH m PCE 0.0014 0.0014 0.0014 0.002 0.0026
AEU . ENR 0.0048 0.0048 0.0067 0.0086 0.0095
LCE m ENR 0.0009 0.0009 0.0012 0.0015 0.0017
AMU m ENR 0.0015 0.0021 0.0021 0.0027 0.003
DRR m ENR 0.0026 0.0036 0.0036 0.0047 0.0052
DFE m ENR 0.0016 0.0026 0.0036 0.0047 0.0052
EMS m ENR 0.0029 0.0048 0.0067 0.0086 0.0095
WDM m ENR 0.0029 0.0048 0.0067 0.0086 0.0095
NST m DIN 0.0091 0.0274 0.0457 0.064 0.0822
LOI m DIN 0.0046 0.0137 0.0228 0.032 0.0411
LKT m DIN 0.0025 0.0074 0.0123 0.0172 0.0221
NSV m DIN 0.0014 0.0042 0.007 0.0098 0.0126
LOP m INC 0.0065 0.0065 0.0108 0.0151 0.0216
MTT m INC 0.0036 0.0036 0.006 0.0084 0.012
CRR m INC 0.0019 0.0019 0.0032 0.0045 0.0064
PDC m INN 0.0025 0.0076 0.0126 0.0177 0.0227
PIR m INN 0.0022 0.0037 0.0037 0.0052 0.0067
ATI m INN 0.0042 0.007 0.007 0.0098 0.0126
LOI m TMC 0.0053 0.0267 0.0374 0.0481 0.0481
STF m TMC 0.003 0.0148 0.0208 0.0267 0.0267
DFR m TMC 0.0016 0.0079 0.011 0.0142 0.0142
INI m INS 0.0189 0.0189 0.034 0.0378 0.0378
INA m INS 0.0105 0.0105 0.0189 0.021 0.021
INT m INS 0.0056 0.0056 0.0101 0.0112 0.0112
DUH m EEN 0.0073 0.0073 0.0103 0.0103 0.0132
TUH m EEN 0.0028 0.0028 0.0039 0.0039 0.005
LCA m EEN 0.0016 0.0016 0.0023 0.0023 0.0029
QUL m SUC 0.0037 0.0062 0.0087 0.0112 0.0124
GRA m SUC 0.0021 0.0035 0.0048 0.0062 0.0069
LOR m SUC 0.0011 0.0019 0.0026 0.0033 0.0037
Table XI. FIS m FIS 0.0028 0.0083 0.0139 0.0139 0.0194
Partial performance CTC m CTC 0.0015 0.0046 0.0077 0.0077 0.0108
measures of the SD at RDF m RDF 0.0008 0.0025 0.0041 0.0041 0.0058
different periods Desirability index 0.348 0.493 0.664 0.792 1
 Critical success factor
PMB LSG SUS PCE ENR DIN INC INN TMC INS EEN SUC SSC

PT 1 0.524 0.423 0.385 0.5 0.394 0.111 0.3 0.212 0.111 0.5 0.555 0.3 0.142
PT 2 0.681 0.477 0.429 0.55 0.541 0.334 0.3 0.438 0.555 0.5 0.555 0.504 0.428
PT 3 0.692 0.620 0.717 0.55 0.702 0.556 0.5 0.555 0.778 0.9 0.782 0.7 0.714
PT 4 0.717 0.729 0.717 0.777 0.904 0.778 0.7 0.779 1 1 0.782 0.9 0.714
of supplier
development

at different periods
Performance

Table XII.
Aggregated indices of SD
227
IJPPM References
63,2 Aggrawal, D.K. (2007), Text Book of Logistics and Supply Chain Management, Macmillan
Publishers India Limited, Delhi.
Arroyo-Lopez, P., Holmen, E. and de Boer, L. (2012), “How do supplier development programs
affect suppliers?: insights for suppliers, buyers and governments from an empirical study
in Mexico”, Business Process Management Journal, Vol. 18 No. 4, pp. 680-707.
228 Bai, C. and Sarkis, J. (2011), “Evaluating supplier development programs with a grey based rough
set methodology”, Expert Systems With Applications, Vol. 38 No. 11, pp. 13505-13517.
Carr, A.S. and Kaynak, H. (2007), “Communication methods, information sharing, supplier
development and performance: an empirical study of their relationships”, International
Journal of Operations and Production Management, Vol. 27 No. 4, pp. 346-370.
Carr, A.S. and Pearson, J.N. (1999), “Strategically managed buyer-supplier relationships and
performance outcomes”, Journal of Operations Management, Vol. 17 No. 5, pp. 497-519.
Carson, D., Cromie, S., McGowan, P. and Hill, J. (1995), Marketing and Entrepreneurship in SMEs:
An Innovative Approach, Prentice Hall, London.
Chandrasekaran, N. (2010), Supply Chain Management: Process, System and Practice, Oxford
University Press, Delhi.
Chiang, C.-Y., Kocabasoglu-Hillmer, C. and Nallan Suresh, N. (2012), “An empirical investigation
of the impact of strategic sourcing and flexibility on firm’s supply chain agility”,
International Journal of Operations and Production Management, Vol. 32 No. 1, pp. 49-78.
Chidambaranathan, S., Muralidharan, C. and Deshmukh, S.G. (2009), “Analyzing the critical
factors of supplier development using interpretive structure modeling-an empirical
study”, International Journal of Advanced Manufacturing Technology, Vol. 43 Nos 11/12,
pp. 1081-1093.
Christopher, M., McKinnon, A., Sharp, J., Wilding, R., Peck, H., Chapman, P., Juttner, U. and
Bolumole, Y. (2002), Supply Chain Vulnerability, Cranfield University, Cranfield.
D’angelo, A., Gastaldi, M. and Levialdi, N. (1996a), “Multi-criteria evaluation model for flexible
manufacturing system design”, Computer Integrated Manufacturing Systems, Vol. 9 No. 3,
pp. 171-178.
D’angelo, A., Gastaldi, M. and Levialdi, N. (1996b), “Dynamic analysis of the performance of a
flexible manufacturing system: a real case application”, Computer Integrated
Manufacturing Systems, Vol. 7 No. 2, pp. 101-110.
De Toni, A. and Nassimbeni, G. (2000), “Just-in-time purchasing: an empirical study of
operational practices, supplier development and performance”, The International Journal
of Management Science, Vol. 28 No. 6, pp. 631-651.
Dyer, J.H. and Ouchi, W.G. (1993), “Japanese-style partnerships: giving companies a competitive
edge”, Sloan Management Review, Vol. 35 No. 1, pp. 51-64.
Eckerd, S. and Hill, J.A. (2012), “The buyer-supplier social contract: information sharing as a
deterrent to unethical behaviors”, International Journal of Operations and Production
Management, Vol. 32 No. 2, pp. 238-255.
Fu, X., Zhu, Q. and Sarkis, J. (2012), “Evaluating green supplier development programs at a
telecommunications systems provider”, International Journal of Production Economics,
Vol. 140 No. 1, pp. 357-367.
Giannakis, M. (2008), “Facilitating learning and knowledge transfer through supplier
development”, Supply Chain Management: An International Journal, Vol. 13 No. 1,
pp. 62-72.
Giunipero, L.C. (1990), “Motivating and monitoring JIT supplier performance”, Journal of
Purchasing and Materials Management, Vol. 26 No. 3, pp. 19-24.
Handfield, R.B., Krause, D.R., Scanell, T.V. and Monczka, R.M. (2000), “Avoid the pitfalls in Performance
supplier development”, Sloan Management Review, Vol. 41 No. 2, pp. 37-49.
of supplier
Hartley, J.L. and Jones, G.E. (1997), “Process oriented supplier development: building the
capability for change”, International Journal of Purchasing and Materials Management, development
Vol. 33 No. 3, pp. 24-29.
Hult, T.M., Hurley, R.F. and Knight, G.A. (2004), “Innovativeness: its antecedents and impact on
business performance”, Industrial Marketing Management, Vol. 33 No. 5, pp. 429-438. 229
Humphreys, P., Cadden, T., Wen-Li, L. and McHugh, M. (2011), “An investigation into supplier
development activities and their influence on performance in the Chinese electronics
industry”, Production Planning and Control, Vol. 22 No. 2, pp. 137-156.
Humphreys, P.K., Li, W.L. and Chan, L.Y. (2004), “The impact of supplier development on buyer-
supplier performance”, Omega: The International Journal of Management Science, Vol. 32
No. 2, pp. 131-143.
Humphreys, P.K., Wong, Y.K. and Chan, F.T.S. (2003), “Integrating environmental criteria into the
supplier selection process”, Journal of Materials Processing Technology, Vol. 138 Nos 1-3,
pp. 349-356.
Jianjun, C. and Yang, M. (2011), “Supplier development in the automotive industry: a case in
China”, IEEE 2nd International Conference on Software Engineering and Service Science
(ICSESS), pp. 695-697.
Kannan, G., Kannan, D. and Haq, A.N. (2010), “Analyzing supplier development criteria
for an automobile industry”, Industrial Management and Data Systems, Vol. 110 No. 1,
pp. 43-62.
Kodali, R. and Chandra, S. (2001), “Analytical hierarchy process for justification of total
productive maintenance”, Production Planning and Control, Vol. 12 No. 7, pp. 695-705.
Kodali, R. and Routroy, S. (2005), “Analytical hierarchy process for justification of competitive
supply chain”, The Institution of Engineers (India), Production Engineering, Vol. 85 No. 1,
pp. 13-17.
Kodali, R. and Routroy, S. (2006), “Performance value analysis for selection of facilities location in
competitive supply chain”, International Journal of Management and Decision Making,
Vol. 7 No. 5, pp. 476-493.
Kodali, R. and Sangwan, K.S. (2004), “Multi-attribute decision models for justification of cellular
manufacturing systems”, International Journal of Business Performance Management,
Vol. 6 Nos 3/4, pp. 298-320.
Krause, D.R. (1997), “Supplier development: current practices and outcomes”, International
Journal of Purchasing and Materials Management, Vol. 33 No. 2, pp. 12-19.
Krause, D.R. (1999), “The antecedents of buying firm’s efforts to improve suppliers”, Journal of
Operations Management, Vol. 17 No. 2, pp. 205-224.
Krause, D.R. and Scannell, T.V. (2002), “Supplier development practices: product- and service
based industry comparisons”, The Journal of Supply Chain Management, Vol. 38 No. 2,
pp. 13-21.
Krause, D.R., Handfield, R.B. and Scannell, T.V. (1998), “An empirical investigation of supplier
development: reactive and strategic processes”, Journal of Operations Management,
Vol. 17 No. 1, pp. 39-58.
Krause, D.R., Handfield, R.B. and Tyler, B.B. (2007), “The relationships between supplier
development, commitment, social capital accumulation and performance improvement”,
Journal of Operations Management, Vol. 25 No. 2, pp. 528-545.
Krause, D.R., Scannell, T.V. and Calantone, R.J. (2000), “A structural analysis of the effectiveness
of buying firm’s strategies to improve supplier performance”, Decision Sciences, Vol. 31
No. 1, pp. 33-55.
IJPPM Large, R.O. and Thomsen, C.G. (2011), “Drivers of green supply management performance:
evidence from Germany”, Journal of Purchasing and Supply Management, Vol. 17 No. 3,
63,2 pp. 176-184.
Leek, S., Turnbull, P.W. and Naude, P. (2003), “How is information technology affecting business
relationships? Results from a UK survey”, Industrial Marketing Management, Vol. 32
No. 2, pp. 119-126.
230 Li, W., Humphreys, P., Chan, L.Y. and Kumaraswamy, M. (2003), “Predicting purchasing
performance: the role of supplier development programs”, Journal of Materials Processing
Technology, Vol. 138 Nos 1/3, pp. 243-249.
Li, W., Humphreys, P.K., Yeung, A.C.L. and Cheng, T.C.E. (2012), “The impact of supplier
development on buyer competitive advantage: a path analytic model”, International
Journal of Production Economics, Vol. 135 No. 1, pp. 353-366.
Liao, K., Ma, Z., Lee, J.J.-Y. and Ke, K. (2011), “Achieving mass customization through trust
driven information sharing between buyer and supplier: a supplier perspective”,
Management Research Review, Vol. 34 No. 5, pp. 1-17.
Lockström, M. and Lei, L. (2012), “Antecedents to supplier integration in China: a partial
least squares analysis”, International Journal of Production Economics, Vol. 141 No. 1,
pp. 295-306.
Lu, R.X.A., Lee, P.K.C. and Cheng, T.C.E. (2012), “Socially responsible supplier development:
construct development and measurement validation”, International Journal of Production
Economics, Vol. 140 No. 1, pp. 160-167.
McGovern, T. and Hicks, C. (2006), “Specifications and supplier development in the UK electrical
transmission and distribution equipment industry”, International Journal of Production
Economics, Vol. 104 No. 1, pp. 164-178.
Mahmood, W.H.W., Tahar, N.M., Rahman, M.N.A. and Deros, B.M. (2011), “Supply chain
enhancement through product and vendor development programme”, Journal of Modelling
in Management, Vol. 6 No. 2, pp. 164-177.
Mao, H. (2007), “Suppliers’ innovative capabilities and their relationship with customers: an
evidence from packaging machinery industry in China”, International Conference on
Computational Intelligence and Security Workshops, pp. 862-865.
Marksberry, P. (2012), “Investigating ‘The Way’ for Toyota suppliers: a quantitative outlook on
Toyota’s replicating efforts for supplier development”, Benchmarking: An International
Journal, Vol. 19 No. 2, pp. 277-298.
Modi, S.B. and Marbet, V.A. (2007), “Supplier development: improving supplier
performance through knowledge transfer”, Journal of Operations Management, Vol. 25
No. 1, pp. 42-64.
Monczka, R.M. and Trent, R.J. (1991), “Evolving sourcing strategies for the 1990s”, International
Journal of Physical Distribution and Logistics Management, Vol. 21 No. 5, pp. 4-12.
Morgan, J. (1993), “Supplier programs take time to become world class”, Purchasing, Vol. 19 No. 2,
pp. 61-63.
Morris, J. (1991), Japan and the Global Economy: Issues and Trends in the 1990s, Routledge, London.
Nagati, H. and Rebolledo, C. (2013), “Supplier development efforts: the suppliers’ point of view”,
Industrial Marketing Management, Vol. 42 No. 2, pp. 180-188.
Oh, J. and Rhee, S. (2008), “The influence of supplier capabilities and technology uncertainty
on manufacturer-supplier collaboration: a study of the Korean automotive industry”,
International Journal of Operations and Production Management, Vol. 28 No. 6,
pp. 490-517.
Partovi, F.Y. (1994), “Determining what to benchmark: an analytic hierarchy process approach”,
International Journal of Operations and Production Management, Vol. 14 No. 6, pp. 25-29.
Petroni, A. and Panciroli, B. (2002), “Innovation as a determinant of suppliers’ roles and Performance
performances: an empirical study in the food machinery industry”, European Journal of
Purchasing and Supply Management, Vol. 8 No. 3, pp. 1-35. of supplier
Port, O., Schiller, Z. and King, R.W. (1990), “A smarter way to manufacture”, Business Week, development
Vol. 110, 30 April, pp. 110-117.
Reed, F.M. and Walsh, K. (2002), “Enhancing technological capability through supplier
development: a study of the UK aerospace industry”, IEEE Transactions on Engineering 231
Management, Vol. 49 No. 3, pp. 231-242.
Roger, N. (1987), “Justification of FMS with the analytical hierarchy process”, Journal of
Manufacturing, Vol. 7 No. 3, pp. 175-182.
Routroy, S. (2008), “Decision framework for supplier evaluation and selection in supply chain”,
The ICFAI University Journal of Supply Chain Management, Vol. 5 No. 3, pp. 19-32.
Routroy, S. (2009a), “Selection of third party logistics provider in supply chain”, International
Journal of Services Technology and Management, Vol. 12 No. 1, pp. 23-34.
Routroy, S. (2009b), “Evaluation of supply chain strategies: a case study”, International Journal of
Business Performance and Supply Chain Modelling, Vol. 1 No. 4, pp. 290-306.
Routroy, S. and Pradhan, S.K. (2012), “Framework for green procurement: a case study”,
International Journal of Procurement Management, Vol. 5 No. 3, pp. 316-336.1
Routroy, S. and Pradhan, S.K. (2013), “Analyzing the sourcing alternatives in an Indian
manufacturing company”, Journal of Advances in Management Research, Vol. 10 No. 1,
pp. 22-44.
Saaty, T.L. (1980), The Analytic Hierarchy Process, McGraw-Hill, New York, NY.
Saaty, T.L. (2000), Fundamentals of Decision Making and Priority Theory, 2nd ed., RWS
Publications, Pittsburgh, PA.
Saaty, T.L. (2001), Decision Making for Leaders: The Analytic Hierarchy Process for Decisions in a
Complex World: 1999/2000 Edition, Vol. 2, RWS publications, Pittsburgh.
Sako, M. (2004), “Supplier development at Honda, Nissan and Toyota: comparative case studies
of organizational capability enhancement”, Industrial and Corporate Change, Vol. 13 No. 2,
pp. 281-308.
Sanchez-Rodrı́guez, C., Hemsworth, D. and Martı́nez-Lorente, Á. (2005), “The effect of supplier
development initiatives on purchasing performance: a structural model”, Supply Chain
Management: An International Journal, Vol. 10 No. 4, pp. 289-331.
Seuring, S. and Müller, M. (2008), “From a literature review to a conceptual framework for
sustainable supply chain management”, Journal of Cleaner Production, Vol. 16 No. 15,
pp. 1699-1710.
Sharafi, Z. and Parvizian, J. (2011), “Supplier development: a decision making problem”,
Industrial Engineering and Engineering Management, IEEE International Conference,
pp. 1199-1203.
Sharma, M. and Kodali, R. (2008), “TQM implementation elements for manufacturing
excellence”, The TQM Magazine, Vol. 20 No. 6, pp. 599-621.
Sharma, M.J. and Yu, S.J. (2012), “Selecting critical suppliers for supplier development to improve
supply management”, OPSEARCH, Vol. 50 No. 1, pp. 42-59.
Sharma, S. (2010), Supply Chain Management: Concepts, Practices and Implementation, Oxford
University Press, Delhi.
Sharma, S.K., Gupta, R.D., Kumar, A. and Singh, B. (2011), “Supplier issues for lean
implementation”, International Journal of Engineering Science and Technology, Vol. 3 No. 5,
pp. 3900-3905.
IJPPM Shokri, A., Farhad, N. and Simon, H. (2010), “Supplier development practice: arising the problems
of upstream delivery for a food distribution SME in the UK”, Robotics and Computer-
63,2 Integrated Manufacturing, Vol. 26 No. 6, pp. 639-646.
Svensson, G. (2000), “A conceptual framework for the analysis of vulnerability in supply chains”,
International Journal of Physical Distribution and Logistics Management, Vol. 30 No. 9,
pp. 731-750.
232 Talluri, S., Narasimhan, R. and Chung, W. (2010), “Manufacturer cooperation in supplier development
under risk”, European Journal of Operational Research, Vol. 207 No. 1, pp. 165-173.
Trent, R.J. and Llewellyn, R.R. (2009), Managing Global Supply and Risk: Best Practices, Concepts,
and Strategies, J. Ross Publishing, Florida.
Verhees, F.J.H.M. and Meulenberg, M.T.G. (2004), “Market orientation, innovativeness, product
innovation, and performance in small firms”, Journal of Small Business Management,
Vol. 42 No. 2, pp. 134-154.
Wagner, S.M. (2006), “Supplier development practices: an exploratory study”, European Journal
of Marketing, Vol. 40 Nos. 5/6, pp. 554-571.
Wagner, S.M. (2010), “Indirect and direct supplier development: performance implications
of individual and combined effects”, IEEE Transactions on Engineering Management,
Vol. 57 No. 4, pp. 536-546.
Wagner, S.M. (2011), “Supplier development and the relationship life-cycle”, International Journal
of Production Economics, Vol. 129 No. 2, pp. 277-283.
Wang, C.L. and Ahmed, P.K. (2004), “The development and validation of the organizational
innovativeness construct using confirmatory factor analysis”, European Journal of
Innovation Management, Vol. 7 No. 4, pp. 303-313.
Watts, C.A. and Hahn, C.K. (1993), “Supplier development program: an empirical analysis”,
International Journal of Purchasing and Materials Management, Vol. 29 No. 2, pp. 10-17.
Wen-Li, L., Humphreys, P., Chan, L.Y. and Kumaraswamy, M. (2003), “Predicting purchasing
performance: the role of supplier development programs”, Journal of Materials Processing
Technology, Vol. 138 Nos 1-3, pp. 243-249.
Williams, Z. and Moore, R. (2007), “Supply chain relationships and information capabilities: the
creation and use of information power”, International Journal of Physical Distribution &
Logistics Management, Vol. 37 No. 6, pp. 469-483.
Wu, W.-Y., Lin, C., Chen, S.-H. and Wang, H.-C. (2011), “The mediating effect of relationship
learning on the relationship between supplier development strategy and raising
competence”, African Journal of Business Management, Vol. 5 No. 13, pp. 5136-5151.
Wynstra, F., Anderson, J.C., Narus, J.A. and Marc Wouters, M. (2012), “Supplier development
responsibility and NPD project outcomes: the roles of monetary quantification of
differences and supporting-detail gathering”, Journal of Product Innovation Management,
Vol. 29 No. 1, pp. 103-123.
Further reading
Dunn, S.C. and Young, R.R. (2004), “Supplier assistance within supplier development initiatives”,
Journal of Supply Chain Management, Vol. 40 No. 3, pp. 19-29.
Hong, P., Roh, J.J. and Rawski, G. (2012), “Benchmarking sustainability practices: evidence from
manufacturing firms”, Benchmarking: An International Journal, Vol. 19 Nos 4/5, pp. 634-648.
Kumar, P., Shankar, R. and Yadav, S.S. (2012), “An analysis of supplier development issues in
global context: an approach of fuzzy based modeling”, International Journal of Logistics
Systems and Management, Vol. 11 No. 3, pp. 407-428.
Meena, P.L. and Sarmah, S.P. (2012), “Development of a supplier satisfaction index model”,
Industrial Management and Data Systems, Vol. 112 No. 8, pp. 1236-1254.
Singh, R.K. (2011), “Analyzing the interaction of factors for success of total quality management Performance
in SMEs”, Asian Journal on Quality, Vol. 12 No. 1, pp. 6-19.
of supplier
About the authors development
Sudeep Kumar Pradhan has received Bachelor of Technology in Mechanical Engineering from
the Biju Patnaik University of Technology, Orissa and Master of Engineering in Manufacturing
System Engineering from BITS, Pilani. At present, he is working as a Lecturer (Mechanical 233
Engineering Department) in BITS, Pilani. His research interest lies in supply management in
a manufacturing environment. Sudeep Kumar Pradhan is the corresponding author and can be
contacted at: sudeep.bits07@gmail.com
Dr Srikanta Routroy has received Bachelor of Technology in Mechanical Engineering from
College of Engineering and Technology, Bhubaneswar and Master of Technology in Industrial
Engineering and Management from IIT, Kharagpur. He has completed his PhD in the area of supply
chain management from Birla Institute of Technology and Science (BITS), Pilani. At present, he is
working as an Assistant Professor (Mechanical Engineering Department) in Birla Institute of
Technology and Science, Pilani. His research interests are in the areas of supply chain management,
production and operations management, evolutionary computation and manufacturing management.

To purchase reprints of this article please e-mail: reprints@emeraldinsight.com

Or visit our web site for further details: www.emeraldinsight.com/reprints