Title: Managing supplier relations with balanced scorecard

Authors: Staffan Brege, Per-Olof Brehmer, Jakob Rehme

Addresses: School of Management, Institute of Technology, Linkoping University, Linkoping SE-581 83, Sweden. ' School of Management, Institute of Technology, Linkoping University, Linkoping SE-581 83, Sweden. ' School of Management, Institute of Technology, Linkoping University, Linkoping SE-581 83, Sweden

Abstract: As a consequence of increased outsourcing, companies become more and more virtual organisations and dependent upon external sources to reach their strategic objectives. Here, lacking supplier performance or commitment can result in failure of the outsourcing programme that significantly risks the financial results of the outsourcing company. Consequently, when outsourcing it is important to assure that the supplier performs as expected. This study uses a Balanced Scorecard (BSC) perspective for investigating performance measurements in outsourcing. The results illustrate the importance of a process perspective when outsourcing (securing volume, high quality at the right time). Formulating a BSC for a supplier, an outsourcing company could better control/steer the supplier on an output/performance level.

Keywords: balanced scorecard; BSC; outsourcing; risks; suppliers; information technology; wood product manufacturers; supplier relations; performance measurement.

DOI: 10.1504/IJKMS.2008.016447

International Journal of Knowledge Management Studies, 2008 Vol.2 No.1, pp.147 - 161

Available online: 28 Dec 2007 *

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