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Design of a supplier performance measurement & evaluation system for DSM’s Petrochemical & Energy Group

Beijer, T.A. (2012) Design of a supplier performance measurement & evaluation system for DSM’s Petrochemical & Energy Group.

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Abstract:Research problem definition and research question For DSM’s Sourcing Petrochemicals & Energy department, there are only a limited number of suppliers big and capable enough to supply DSM. Therefore, DSM’s current sourcing strategy is focused on the development of long term strategic relationships with so called “strategic” suppliers. DSM’s main objective is to achieve a continuous improvement of DSM’s supplier business processes, reduce DSM’s cost and develop and maintain a higher degree of “Sustainability" and ”Innovation”. “Sustainability” and “Innovation” are part of DSM’s core values and are increasingly part of DSM’s key business growth drivers. DSM’s willingness to develop a long term commitment with suppliers can be acknowledged by the fact that DSM is willing to share in-house information, train suppliers and share financial benefits with strategic suppliers. To support this strategy, DSM is using “performance measurement” as a quality improvement mechanism to measure the progress of suppliers over time and to use this information to develop shortterm and long-term goals and objectives. The main research focus of this thesis is related to the use of “performance measurement” by DSM’s Petrochemical and Energy group which comprises six business groups. The main research problem of this thesis is related to the gathering, analysis and interpretation of gathered performance data from the six business groups. Currently, each business group has its own Supplier Performance Measurement & Evaluation System in place, which includes business group specific critical success factors and key performance indicators. Also, the data analysis performed by the business groups differs. Some business groups use traditional methods such as supplier rating with the use of scorecards or Microsoft Excel, while other business groups use a more modern approach that includes the use of advanced SAP supplier measurement & evaluation modules. The use of SAP is less time consuming and enables the user to generate a complete supplier evaluation report. This is one of the reasons DSM management prefers SAP over the traditional methods that are still in use. Therefore, the second objective of this research is to develop a SAP environment in which the new Supplier Performance Measurement & Evaluation System can operate. Currently, DSM is not satisfied by the way performance data is gathered, analysed and processed. DSM prefers one standardised Supplier Performance Measurement & Evaluation System for all business groups, that includes an alignment of critical success factors and key performance indicators and allows an easier and faster supplier performance evaluation. This is required to support DSM’s current sourcing objective that includes the continuous improvement of supplier capabilities.
Item Type:Essay (Master)
Clients:
DSM
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:52 mechanical engineering
Programme:Industrial Engineering and Management MSc (60029)
Link to this item:http://purl.utwente.nl/essays/61705
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