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.
OTIF (On‑Time, In‑Full)
Formula: (On‑time & complete deliveries ÷ total deliveries) × 100
Lead‑Time Adherence
Formula: (Orders meeting agreed lead time ÷ total orders) × 100
Schedule Adherence (MPS/MRP)
Formula: (Lines delivered on planned date ÷ total lines) × 100
PPM (Defects per Million)
Formula: (Defective units ÷ total units) × 1,000,000
Right‑First‑Time (RFT)
Formula: (Lots accepted at first pass ÷ total lots) × 100
NCR Rate (Non‑Conformances)
Formula: (NCRs in period ÷ receipts in period) × 100
Cost Variance vs. Should‑Cost
Formula: (Actual price – should‑cost) ÷ should‑cost × 100
Price Indexation Compliance
Formula: (Lines priced per agreed index formula ÷ indexed lines) × 100
Expedite Cost as % of Spend
Formula: (Expedite fees ÷ category spend) × 100
Quote Cycle Time
Formula: Avg. days from RFQ to complete quote
Corrective Action SLA Compliance
Formula: (CAPAs closed on time ÷ total CAPAs) × 100
Audit Score (weighted)
Formula: Σ(section score × weight) ÷ Σ(weights)
Certifications Current
Formula: (Suppliers with valid certificates ÷ in‑scope suppliers) × 100
Incident Rate (H&S/ESG) – Supplier
Formula: Incidents per 200k hours (or per million units)
Innovation Throughput
Formula: (Ideas qualified → pilots → implemented) with quarterly funnel ratios
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.