Top 15 Supplier Performance Management KPIs

If you can’t measure it, you can’t improve it - and nowhere is that truer than in supplier performance. The right supplier performance management KPIs turn anecdotes into evidence, align procurement with operations and quality, and give you the leverage to improve service, cost, and risk without guesswork. In this guide, we’ve curated the Top 15 Supplier Performance Management KPIs - the metrics procurement teams actually use to run monthly ops reviews and quarterly business reviews.

Don't miss our blog post on Supplier Performance Management Template & Cadence here.  

Delivery & Reliability

1. OTIF (On‑Time, In‑Full)
   Formula: (On‑time & complete deliveries ÷ total deliveries) × 100

2. Lead‑Time Adherence
   Formula: (Orders meeting agreed lead time ÷ total orders) × 100

3. Schedule Adherence (MPS/MRP)
   Formula: (Lines delivered on planned date ÷ total lines) × 100

Quality

4. PPM (Defects per Million)
   Formula: (Defective units ÷ total units) × 1,000,000

5. Right‑First‑Time (RFT)
   Formula: (Lots accepted at first pass ÷ total lots) × 100

6. NCR Rate (Non‑Conformances)
   Formula: (NCRs in period ÷ receipts in period) × 100

Cost & Commercials

7. Cost Variance vs. Should‑Cost
   Formula: (Actual price – should‑cost) ÷ should‑cost × 100

8. Price Indexation Compliance
   Formula: (Lines priced per agreed index formula ÷ indexed lines) × 100

9. Expedite Cost as % of Spend
   Formula: (Expedite fees ÷ category spend) × 100

Service & Responsiveness

10. Quote Cycle Time
    Formula: Avg. days from RFQ to complete quote

11. Corrective Action SLA Compliance
    Formula: (CAPAs closed on time ÷ total CAPAs) × 100

Risk & Compliance

12. Audit Score (weighted)
    Formula: Σ(section score × weight) ÷ Σ(weights)

13. Certifications Current
    Formula: (Suppliers with valid certificates ÷ in‑scope suppliers) × 100

Sustainability & Innovation

14. Incident Rate (H&S/ESG) – Supplier
    Formula: Incidents per 200k hours (or per million units)

15. Innovation Throughput
    Formula: (Ideas qualified → pilots → implemented) with quarterly funnel ratios

Target‑setting tips

• Use top‑quartile internal benchmarks plus external references where available.

• Pair each KPI with a decision (e.g., OTIF drives allocation; indexation compliance drives price updates).

• Track trend and stability, not just point‑in‑time performance.

Read more about the basics of Supplier Performance Management here, or learn how you can implement supplier performance management software to automate these processes for you. Reach out to Kodiak Hub below if you want to know more.