OPTION (10) Modifications to Baseline - Minimal                                GRAPHIC EXAMPLE

(MPO-Z-00) WORLD-CLASS VENDOR DELIVERY MEASUREMENT

This module, built in real-time from Receipts, stores data by both Vendor and Part, by Fiscal Year and Fiscal Month.

Totals are maintained of Receipts that are early, late, and on time, by volume of receipts, number of days, quantity, and dollars. Each of the provided fields is ranked, by both Vendor and Part, to allow reporting of Vendors and Parts in relative performance sequence. A Control Table allows On-Time measurement using the baseline early-late parameters by individual Vendor, user-entered early-late parameters, or Commodity Code.

This memorandum provides information about the theory of measurement of Vendor On-Time Delivery Performance. Each company may have differing standards of performance, and this Custom Module allows measurement by individual Vendor, Parts Commodity Code, or one set of standards for ALL Vendors. It is recommended that a few critical measurements be used, instead of numerous smaller measurements, targeted at the company's strategic World-Class Manufacturing direction.

The overall goal is to determine which Vendors are providing the best service, to allow the company to move towards using fewer sources of supply for the same Part or Commodity. Moving towards World-Class JIT Vendor relationships will allow for less on-hand inventory, and reduction of buffer stocks.

Per REFERENCE SOURCES, author Brian Maskell makes the following points:

1). Place orders with Vendors for the right raw materials and components, in the right quantities. Placing an incorrect order with Vendors and then modifying the orders is an expensive and wasteful activity, for both the company and the Vendor. Measuring the number of changes in a time period can give a good idea of the effectiveness of the planning process.

2). Deliver orders on time and in the correct quantities. Vendor Delivery Performance is a key measure used by most World Class manufacturers.