Press esc to head back

MRO-Transition
Managing Supplier Performance

Ver 1.0 (Jun 22)

1. Key Points

There may be many triggers that activate the need for a performance review.  Carrying out any such review must always be done DURING the contract term.    Why?  This ensures the budget versus actual performance is re-assessed in order to potentially make adjustments for the remaining tenure of the supplier’s contract term, if not already completed annually. 

Examples of Commercial and Qualitative challenges and that may be the subject for a review are but not limited to:

  • Suppliers performance against KPI’s or the SLA
  • Poor financial performance
  • Budget challenges through client cost save requirements
  • Budget overspends, reduced budgets, commercial challenges
  • Style, service scope and specification changes
  • Innovation, refurbishment, new build and right sizing
  • Anticipated change in supplier
  • CBRE scope enhancement
  • Low customer satisfaction

The Importance of Good Supplier Performance

KEY Triggers to Managing Supplier Performance

1.

Poor KPI Performance

1. Poor KPI Performance

2.

Not adhering to the SLA

2. Not adhering to the SLA

3.

Financially underperforming

1. Poor KPI Performance

4.

Low Customer Satisfaction

5.

Outside Influences

6.

Change in Scope

1. Early supplier engagement is key to a successful outcome for Performance improvement
2. Present FACTS, not emotive ideas
3. Ensure a measurable process is in place to manage performance
4. Ensure the supplier understands the expectations of the contract and its required outcomes
5. Openly discuss issues in regular meetings to mitigate any escalations, where practical
6. Form the right relationships with the suppliers to foster best in class practices

Reference Templates:

Page 1 of 3

Confidential & Proprietary | 2022 CBRE Inc.

XXX-XXX

XXX

MRO-Transition

Supplier Performance Improvement Process (PIP)

Ver 1.0 (Jun 22)

Supplier Performance Improvement Process (PIP)

Is...

  1. A strategic level supplier corrective action process
  2. Defined service improvement objectives and timelines
  3. Championed by supply chain leadership, but managed by the supplier
  4. An objective measurement of supplier improvement resulting in sustainable service quality
  5. Regular cadence of reviews to discuss supplier progress to plan
  6. A final disposition of supplier performance used to determine supplier’s status with CBRE
  7. A process that can be launched at the account level or central operations support team

Is NOT...

  1. A day-to-day supplier quality management process
  2. An emotionally driven process
  3. A tool to beat-down suppliers into conformance
  4. A process that has no end or result
  5. Measured by subjective data

Refer to Page 3 for

Next Steps to be followed

Confidential & Proprietary | 2022 CBRE, Inc.

Food Services-Transition

Supplier Performance Improvement Process (PIP)

MRO-Transition

Supplier Performance Improvement Process Steps

1. Review Objective evidence of poor performance over time including prior Corrective Action efforts

2. Identify and document improvement Objectives, desired outcomes and Timing

3. Identify Key Stakeholders which include the Supplier

4. Identify Performance Improvement Team and Team Champions

5. Gain sponsorship and approval from Supply Chain key Stakeholders to launch a 90 day PIP

6. Complete a Charter to communicate the PIP Objectives, timing, support, tools and outcomes

7. Communicate the launch of the 90 day PIP and explain the overall process

8. Schedule meetings with all Stakeholders to launch the PIP

10. Supplier to create a progress Dashboard that communicates the overall improvement status

9. Request Supplier to initiate the 90 day PIP

11. Communicate agreement on timing, reporting and expected outcomes to all

12. Plan for final review after 90 days and any next steps

Ver 1.0 (Jun 22)

Confidential & Proprietary | 2022 CBRE, Inc.