Premium
Supplier Selection and Assessment: Their Impact on Business Performance
Author(s) -
Kannan Vijay R.,
Tan Keah Choon
Publication year - 2002
Publication title -
journal of supply chain management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.75
H-Index - 92
eISSN - 1745-493X
pISSN - 1523-2409
DOI - 10.1111/j.1745-493x.2002.tb00139.x
Subject(s) - business , outsourcing , supplier relationship management , selection (genetic algorithm) , supplier evaluation , core (optical fiber) , industrial organization , core competency , marketing , production (economics) , supply chain management , supply chain , microeconomics , computer science , economics , telecommunications , artificial intelligence
SUMMARY Increasingly, firms are allocating more resources to their core competencies and encouraging the outsourcing of non‐core activities, which increases their reliance and dependence on suppliers. This increases the importance of effective supplier selection and assessment. Sparse evidence exists regarding the impact of supplier selection and assessment on a buying firm's business performance. This research describes an empirical study of the importance of supplier selection and assessment criteria of American manufacturing companies for items to be used in products already in production. Moreover, it identifies relationships between criteria and a buying firm's business performance. Results indicate that soft, non‐quantifiable selection criteria, such as a supplier's strategic commitment to a buyer, have a greater impact on performance than hard, more quantifiable criteria such as supplier capability, yet are considered to be less important. Assessment of a supplier's willingness and ability to share information also has a significant impact on the buying firm's performance, yet is again considered to be relatively unimportant.