Scorecards to Manage Suppliers

In many organisations, services such as catering, building security, fleet, and travel management, are outsourced to other organisations. In this common scenario, the role of the facilities manager is to manage the supplier to ensure the service is delivered to the agreed specification. This article covers how services can we effectively managed using scorecards.

Monitoring Performance

One popular way to perform this oversight and monitor performance is by setting up and implementing a scorecard. There are many different ways to do this but a balanced scorecard is usually particularly effective. A balanced scorecard has measures which are both quantitative and qualitative. This is useful as it allows the hard metrics to be measured and analysed, but it also gives some representation to softer measures, such as the dedication of the staff. For all quantitative targets they should be SMART; which is a useful acronym to remember that if they are to be useful they should be specific, measurable, attainable, realistic, and timely.

Setting up a Scorecard

The best way to set up the scorecard is for the supplier and facilities manager to sit down and agree what the service requirements are and the desired delivery targets. Some of these aspects may already be set out in the contract, and in that case they can be lifted straight out into the scorecard. We can take an example from a catering contract whereby Company A manages an onsite restaurant. A requirement may be that customer complaints relating to the food are under 0.5% of transactions. This can easily be tracked and reported on. It may be that if this requirement is not met, there are financial penalties for Company A, or perhaps they are obligated to put a remediation plan in place.

Reviewing a Scorecard

The balanced scorecard would usually be reviewed by both parties either monthly or quarterly depending on the type of service being delivered. There are many benefits of this approach, predominantly that the facilities manager will have oversight of the service provision without having to spend too much time on a daily basis getting involved in the detail.

Peter ForshawMaxwell Stephens

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