What is vendor evaluation?
Vendor evaluation is the assessment of candidate suppliers against requirements the organisation has defined for itself. Unlike public tendering it is rarely bound by published criteria, which means the discipline has to be imposed internally. The output is a recorded comparison rather than a recommendation asserted in a summary slide.
Also called: Supplier evaluation
Why an internal procurement decision still needs a record
The characteristic failure here is the evaluation reverse engineered from a conclusion somebody had already reached in a sales meeting. Requirements are drafted after the shortlist and weightings are chosen once the scores are known. The resulting document describes a decision rather than producing one. Nobody outside the organisation will challenge it, which is exactly why the discipline has to come from inside, and the cost appears two years later when nobody can reconstruct what the alternative offered.
- A recorded comparison is what makes a renewal decision possible years later.
- Requirements written after the shortlist describe the preferred supplier.
- Internal evaluations face no external challenge, so the discipline is self-imposed.
- A weighted comparison exposes which requirement actually decided the award.
How vendor evaluation works
- Requirements are gathered from the people who will use the system and weighted.
- Mandatory requirements are separated from desirable ones before any supplier is approached.
- Each supplier is assessed against the same requirement set with evidence recorded.
- Demonstrations are scripted to the requirements rather than led by the supplier.
- Scores are combined by the agreed weights and compared across suppliers.
- The comparison is retained with the contract for the renewal decision.
How vendor evaluation is evaluated
A vendor evaluation is assessed on whether it would have produced a different answer had the scores differed. Examine the following before any signature is given:
- proportion of requirements weighted before suppliers were scored
- evidence recorded against each requirement for every supplier
- sensitivity of the outcome to the weighting chosen
- coverage of mandatory requirements by each supplier
- traceability from the recommendation to the recorded scores
Limitations, risks and common failure modes
- Requirements are written from one supplier's feature list and favour them throughout.
- Scores are adjusted until the preferred supplier reaches the top position.
- Demonstrations are led by the supplier, so each one shows a different thing.
- The comparison is discarded after signature, leaving the renewal with no baseline.