Procurement and supply organizations are stricter these days when monitoring the performance of their suppliers—even those who already have been certified as operating with excellent quality practices. And the best supplier partners are being rewarded but not necessarily through public recognition events.

A recent Purchasing survey shows that 73% of the buying groups polled give extra business to their best suppliers while only 27% present formal awards to those top suppliers. Eighty-two percent of the buying groups only send letters of appreciation to their supplier partners and 18% have some kind of recognition ceremony or dinner.

Purchasing professionals always have wanted their suppliers to provide high quality, on-time deliveries, competitive prices, quick response to problems and emergencies and strong technical support. "Timely customer service, on-time delivery and quality are musts and the superior suppliers excel in all these areas," says Brian Ptashnik, a buyer at motor vehicle parts maker Tower Automotive in Novi, Mich.

However, the results of the latest Purchasing survey also indicate that buyers now also rate their suppliers on sharing data, resources and, if necessary, the personnel to overcome obstacles that stand in the way of mutually agreed-upon goals. "We are selecting those suppliers who work with us as partners, not just suppliers," says Rich Wagner at Allegiant Global Services in Indianapolis, a third-party management firm.

"Purchasing's commitment is to satisfy the company's customer expectations for the highest levels of quality and performance, service, on-time delivery, and cost-effectiveness," according to recent comments by Don Weiss, director of material at the Government Communications Systems Division of Harris Corp., an international communications and information technology firm in Palm Bay, Fla. That's why the firm strictly audits suppliers: to ensure they meet high performance standards so Harris "can meet or exceed the expectations of its customers."

Buyers report that budget constraints are part of the reason that such social events as supply chain outings, golf tournaments and buyer-supplier job-performance gatherings are being downgraded or eliminated. One buyer reports that his firm is measuring the performance of a shrinking group of critical suppliers these days—those that supply 80% of the annual spend on production materials. The firm also has reduced recognition awards to honor only the 30% of suppliers that have passed strict performance audits for four consecutive quarters.

The suppliers cited by Nascote Industries are "those who work in partnership with us to improve all aspects of our business," says Art Stolle at the Nashville, Ill., firm that supplies the automotive industry with injection-molded and rim-molded fascias, bumper systems and other plastic parts. "These are the suppliers that help solve our internal problems; they bring us innovations and help streamline the business processes we use."

Supplier rating systems are critical and longstanding components of many corporate supplier management strategy programs. More companies rely on their suppliers these days for an ever-increasing portion of the value delivered to customers. "We expect our suppliers to perform periodic continuous-improvement self assessments of their own operations, along with scheduled installation audits at our facilities," says Chuck Olson of Gulf Stream Coach, a recreational vehicle manufacturer of motor homes and travel trailers in Nappanee, Ind. "Selected suppliers must have quality programs in place, with specific plans for material cost reductions which will ultimately be shared with us."

The poll also shows that suppliers are measured more these days on their performance based on information from numerous functional areas within the end-use company. "It is effortless for the entire company to deal with the best," says another buyer at a Baltimore manufacturing firm. "They know their products, our supply agreement and the status of delivery—and they communicate all this information effectively."