Vendor Management Scorecard Template
It’s a Win Win: Using a VendorScorecard to Manage Your VendorsJennifer Kooy and Dawn M. LynnAbbott Laboratories
Abbott Laboratories Abbott Laboratories is a global, broad-basedhealth care company devoted to discovering newmedicines, new technologies, and new ways tomanage health. Business areas include:June 11, 2013DiagnosticsVascularDiabetes CareVision TechnologiesNutritionEstablished PharmaceuticalsAnimal Health 2013 Abbott
Abbott Library Information Resources (LIR) Abbott LIR serves a diverse group of internal clients withvery different and wide-ranging information needs. LIR Mission: To provide world class, corporate-wideaccess to knowledge resources, literature researchcapabilities and information delivery solutions tosupport and enable Abbott’s research and marketleadership.June 11, 2013 2013 Abbott
The Challenge for Abbott LIR Our challenge: Provide the right content for Abbott’s diverseusers with minimum staff time at the right price point to meet budgetaryguidelines. In 2010, LIR was asked to:- More fully document our content managementand acquisitions procedures- Review these processes in order to makerecommendations to improve themanagement of the Library content portfolioJune 11, 2013 2013 Abbott
The “Vendor Scorecard” In answer to that challenge, LIR developed a deliverablenicknamed the “vendor scorecard” The vendor scorecard has become our standard tool forcontent management: Tracks vendor performance Tracks contract negotiation successes Provides valuable benchmarks that librarianshave been able to leverage during contractnegotiationsJune 11, 2013 2013 Abbott
Developing the Vendor Scorecard The roots of our vendor scorecard are grounded in:- The well-known “magic quadrant” reports by GartnerResearch- Outsell’s Vendor Portfolio Toolkit published inVendor Portfolio Management Toolkit: A DecisionMatrix for Vendor Investment* The tool Outsell developed seeks to “balancestrategic fit of resources and services with thedegree of risk associated with a product’s orvendor’s performance and stability”* The idea is to maximize ROI while managing risk* Lustig, Joanne. “Vendor Portfolio Management Toolkit: A Decision Matrix for VendorInvestment.” (2009) http://www.outsellinc.com/rate/report/850June 11, 2013 2013 Abbott
Assessing Vendors in a Special Library An earlier exercise in rating our vendors using Outsell’stool showed that the vast majority of vendors were inone of two categories:-Top right quadrant indicating high performance and highfitBottom right quadrant indicating strong strategic fitbut weaker performance or higher risk Questions used to assess strategic fit focused on:-June 11, 2013Uniqueness of the vendor’s content setIts value and cost per useThe accuracy and quality of the information thevendor providesThe fairness of its prices compared withcompeting resources 2013 Abbott
Assessing Vendors in a Special Library When broadly applied to STM journal publishers, thequestions of strategic fit are mostly moot, as thevendors are overwhelmingly sole source and our usersrely heavily on their unique content to perform theirjobs. In most circumstances, the answers to strategic fitquestions rarely result in any course of action otherthan the continued purchase the content set.June 11, 2013 2013 Abbott
What to do? We decided our vendor assessment tool would need tobe more descriptive than analytical.- Focus almost exclusively on performance and riskfactors- Resulting actions grounded in processimprovements and cost containment Descriptive metrics track:- Vendor performance (especially related to cost)- Product and platform stability- Vendor staff turn-over- Customer service performanceJune 11, 2013 2013 Abbott
Goals of the Vendor Scorecard The vendor scorecard’s aim is to collect, archive,and display a set of standard data for each vendorcontract in the top 20 percent of Abbott Library’scontent budget spend. The scorecard standardizes the data set andcentralizes its location, making the data moreaccessible throughout the organization.June 11, 2013 2013 Abbott
Abbott LIR Mission StatementStructure of the Vendor ScorecardJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementDescription of vendor and eachproduct licensed, including adetailed description of any platform,performance, billing, or customerservice issues we experiencedduring the term of the contractJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementThree-year spend historyJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementDescription of internal allocationmethodology (fixed budget,allocated cost, direct chargebacketc.) as well as a description ofthe content set’s top user groupswithin AbbottJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementCurrent contract expiration andany special terms or conditions.Detailed supplier pricing modelsdescribing both the licensingmethod (seat-based, concurrentuser, named user, tier-based,etc.) as well as the methodologyused by the vendor to set cost(total headcount, R&Dheadcount, flat-fee pricing,published price, etc.)June 11, 2013 2013 Abbott
Abbott LIR Mission StatementBilling frequency and methodJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementChart listing vendorcompetitors or indicationof sole-source supplierJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementChart with historicinflation rates andAbbott headcountJune 11, 2013 2013 Abbott
Abbott LIR Mission StatementDetailed explanation of contract costchanges for the past three years withspecific attention to explaining/justifyingany cost increases not attributable toinflation or volumeJune 11, 2013 2013 Abbott
Three-year trending of contract cost, including agraph of the year-over-year cost against theindustry average as well as an indication of whatpart of each year’s increase classified as either avolume increase (sales), inflation, or “other”Abbott LIR Mission StatementJune 11, 2013 2013 Abbott
Actionable Value The process of creating and maintaining the scorecardshelp solidify the level of preparedness with which contractnegotiations are conducted in the Abbott Library. Creating and maintaining the scorecards help ensureportfolio managers are prepared for vendor contractconferences. Whole or parts of the scorecard are shared with thevendor if appropriate. Information culled from the scorecards is used tofine-tune our negotiation expectations and focuson the most desired outcomes.June 11, 2013 2013 Abbott
Lessons Learned The first scorecard iteration for a management presentationwas designed to fit on a single Excel worksheet. Whilethis version of the scorecard is attractive and readable,maintaining the format was difficult and time-consuming. Later versions compiled the data in a more proseheavy format while calling out specifically usefulcharts and graphs. Libraries hoping to emulate our experience should:- Be ready to output that data into some sort ofusable format at a moment’s notice uponmanagement request.- Have a standardized way to produce a report thatsummarizes all the key facts without requiring ahigh level of manual manipulation or formatting.June 11, 2013 2013 Abbott
Lessons Learned It became clear that to maintain the data integrity of ourscorecards, we would need to do a better job ofmanaging our contract data. To that end, Abbott’s content management team alsobuilt an Access database to house vendor and budgetdata. That database now archives the information we useto build each year’s scorecards and helps outputneeded vendor and contract data when it isrequired throughout the content managementlifecycle.June 11, 2013 2013 Abbott
Conclusions Developing the vendor scorecard taught us that theprocess of vendor management is more important thanthe output. Time is better spent analyzing the data foreach vendor than creating “pretty” output. Having a standard format for each of our keymetrics took the guesswork out of vendor decisionsand provided a solid foundation for vendorcomparison and evaluation. Standardized processes streamlined staff timeduring the annual vendor decision-making andcontract negotiation process.June 11, 2013 2013 Abbott
Conclusions Having the three-year history laid out in one placeallowed us to immediately visualize trends and identifyareas of both progress and concern. Noting vendor performance throughout the yearallowed us to better address any issues for a moreseamless customer experience as well as potentiallyuse any unresolved issues as leverage during thenext round of negotiations. The Access database that now lies behind thedata has become an invaluable tool for housingvendor and contract information, and was theresult of our more closely examined vendormanagement process.June 11, 2013 2013 Abbott
Have Questions?Need More Information?Contact:Jennifer Kooyjennifer.kooy@abbott.comJune 11, 2013 2013 Abbott
Goals of the Vendor Scorecard The vendor scorecard’s aim is to collect, archive, and display a set of standard data for each vendor contract in the top 20 percent of Abbott Library’s content budget spend. The scorecard standardizes the data set and centralizes its location, mak
Assign a scorecard template to a new scorecard to transfer the scorecard components and their weightings to the scorecard. To guarantee that the components on the scorecard cannot be removed or modified, lock the scorecard. See Chapter 8 of the Hyperion Performance Scorecard – Sy
Prepress Vendor Scorecard / Manufacturing Vendor Scorecard You can come back to the Team tab after the component is in stock and add vendor performance details. The vendor scorecard is used to track vendor performance as well as individual performance by vendor employees and freelancers for
Training Guide Vendor Processing -- Vendor Management Page 3 Vendor Processing -- Vendor Management This is the Vendor Processing -- Vendor Management course within the Vendor Processing curriculum. If you need a reminder on how to na
How to Create a Successful Balanced Scorecard What is a Balanced Scorecard The balanced scorecard is a concept and tool first conceived by by Robert Kaplan and David Norton. The balanced scorecard idea debuted in the Harvard Business Review in 1992. "The balanced scorecard retains traditional financial measures. But financial measures tell the .
Vendor user: - Description: User associated with a Vendor, accessing the Vendor portal. Users associated to the same vendor can see the same documents. One such group will be managed for each vendor (based on uniqueness of Vendor identifier). - Permissions granted: Can see PO attachments for POs associated with that vendor. Internet user
Balanced Scorecard – “Strategic Performance Management System” The main component parts of BSC as Strategic Performance Management System are: the Desired Evolution State, the Strategy Map, the Performance Scorecard (or Balanced Scorecard) and the Initiative Portfolio. Balanced Scorecard / P
Balanced Scorecard 5 Kaplan, R.S., Norton, D.P. (1996b). Using the Balanced Scorecard as a Strategic Management System. Harvard Business Review, 74(1), 75-85. Financial Performance Scorecard: Doing Things Right More Than Just Revenue and Expenses 6 Ruben, Brent, D. (1999, Fall). Toward A Balanced Scorecard for Higher
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