Joint performance appraisal is a relational, collaborative approach to performance measurement and management, in which the buyer assesses the supplier‘s performance and the suppliers assess the buyer‘s performance.
The objective of this approach is to:
- Recognize the impact of the buyer side processes and behaviours (e.g. adversarial supplier relationships, price focused competition) on the performance efficiency and sustainability of the supply chain
- Identify problems within the buyer supplier relationships that may impair the performance of either party, with a view to collaborating problem solution.
- Support long-term value adding relationships by ensuring mutual advantage and the equitable sharing of relationship risk and rewards.
- Encourage collaboration and continuous measurable in supply chain performance and relationship satisfaction.
Joint appraisal measures are typically based on the following themes:
- Shared mutual objectives.
- Compatible benefits to both parties.
- Agreed problem solving methods.
- Shared risks, according to who is best equipped to manage them.
- Continuous measurable improvement
- Proactive managerial relationships.