Supplier opinion surveys: Practical how to’s and key benefits
In our previous article entitled “What does your supplier really think of you?” we introduced Supplier Opinion Surveys to you and discussed the various types of surveys and questions that can be developed to assist you as a procurement professional in understanding the true relationship with your supplier, and to determine those areas which need improvement.
This month’s article discusses the fundamentals of developing a supplier opinion survey and some of the benefits associated with doing so.
“Surveys are a classic method for data collection. They are flexible, easy to implement, and offer a nearly limitless range of data with reliable results. The data gathered during an effective survey provides a unique opportunity to obtain detailed insight into your relationship with your supplier. Because you can gather large amounts of feedback directly from individuals who are affected, surveys act as a finger on the pulse of your business and can measure its strength,” Andrew Hillman, Managing Director of Bespoke Sourcing Solutions, told SmartProcurement.
Traditional paper-based surveys can be very costly to administer and analyse. Much of the cost of data collection is in providing staff and hard resources, such as paper copies of a survey. By harnessing the power of technology, you can create, conduct and review surveys at a much lower cost, while gathering information with a speed and efficiency that you could never achieve using paper surveys. In addition, online data management systems can automatically convert the data into a useful form for analysis.
“The most efficient and effective way of conducting supplier surveys is by using online survey software. One of the great benefits of online survey software is that it collects and analyses your results automatically, which takes a lot of the work out of your research. Automated surveys further eliminate the need for humans to administer the surveys which ultimately decreases the cost and increases accuracy of the data collected,” Hillman continued.
Online surveys have the following additional benefits:
- Reducing lengthy delays between collecting data and interpreting the results;
- Eliminating the need for data entry costs;
- Removing the problems caused by lost or damaged paper surveys;
- Eliminating problems related to interpreting responses that are written by hand;
- Reducing the time it takes for participants to complete and submit a survey;
- Reducing the amount of consumable materials required to administer the survey;
- Placing the survey in a location where it can easily be found and administered; and
- Broadening the audience of the survey while improving response rates.
To design an effective survey, you should ensure the following aspects are covered:
- Determine what type of survey you need to send out and to whom.
- Make sure that respondents have the skills, knowledge and access to the required technology in order to complete the evaluation.
- Collect data from a statistically appropriate sample size. It is not necessary to survey every participant.
- Provide incentives for participants to complete the survey.
- Consider whether you need to provide assistance to your participants in order for them to complete the survey. If, for example, you are performing an evaluation of your entire supply chain which may contain in excess of 100 questions, however, not all need to answered by each respondent, you may need to provide a helpdesk to assist respondents in completing the questionnaire.
- Protect respondents’ privacy when you are asking for sensitive information. When administering online surveys, data can be easily encrypted to provide anonymity.
- Time your survey according to the information you are hoping to gather. Pre-implementation data can be used to guide your program development, whereas post-implementation data can be used to gauge your program’s success and make recommendations for change. Look to your program objectives to help you determine the kind of data you need.
Designing valid questions
Good questions are essential to a survey’s success. Questions should be extremely focused to avoid unexpected responses that confound data analysis.
When formulating a question, start by determining the type of answer you wish to receive. If you want a lengthy description or opinion, ask an open-ended question, such as "What did you do today?". If you want a "yes" or "no" response, ask a closed-ended question, such as, "Did you go to the supermarket today?".
Good questions find a way to measure the expected response. To this end, make a list of possible indicators that relate to the type of responses you are seeking. Once indicators have been determined, you can formulate a valid question.
An effective method for obtaining consistent survey responses is to use a Likert Scale. A Likert Scale allows a participant to provide feedback that is slightly more expansive than a simple close-ended question, but that is much easier to quantify than a completely open-ended response.
A Likert Scale lists a set of statements (not questions) and provides a 5-point or 6-point scale for which the participant can rate his / her level of agreement or disagreement with the statement. For example:
“I was able to locate the information I needed.”
- Strongly agree
- Not sure
- Strongly disagree
Benefits of supplier opinion surveys
Supplier Opinion Surveys have been successfully used in multi-national pharmaceutical organisations, the FMCG industry, the petrochemical industry, the coatings industry and in logistics organisations. The results of these surveys have clearly identified areas where much need attention is required in the dealings between customer and supplier. These areas ranged from internal processes to payment issues, and from corporate governance issues to relationship concerns.
Suppliers are often very pleased to be part of the survey process and appreciate the fact that the customer values their opinion and that their response to the survey will be used to make improvements to the relationship and the processes affecting both parties.
The benefits of satisfied suppliers, as a result of conducting a Supplier Opinion Survey, are as follows:
- Better quality through process;
- Activate and motivate business development;
- Proactive to the customer;
- Improved communication;
- Improved service;
- Fewer conflicts;
- Loyalty (priority, flexibility, capacity);
- People-to-people relationship;
- Transparency and openness;
- Better co-operation, sharing of ideas and technology with customer; and
- Seamless fluent supply chain.
“Supplier Opinion Surveys are an excellent procurement tool providing procurement organisations with invaluable insight into the true relationship with its suppliers. These surveys provide you with information on how suppliers view various aspects of your organisation and help you to understand what you are doing right and what you are doing wrong. Together with your suppliers and partners in the supply chain network, the survey facilitates the development and improvement of your organisation&rs
quo;s internal and external processes. These surveys address both business and communication related aspects, as well as measure the quality of the relationship between your supplier and your organisation,” Hillman continued.
"The collated results of a survey offer true value in that it highlights areas where the supplier and your organisation are investing in resources to improve key processes, but it also identifies those areas where the necessary and appropriate attention is required. Ultimately, from this process, supplier relationships are improved and an environment is created where dealings with suppliers become collaborative in nature and are in the spirit of win-win," Hillman concluded.
To find out more about Supplier Opinion Surveys, contact the author of this article, Andrew Hillman of Bespoke Sourcing Solutions at mobile: +27 82 858 1850, or e-mail: email@example.com