Performance metrics are tools that enable the Postal Service to objectively benchmark the ability of their suppliers to meet company performance standards. Supplier recognition and rewards are linked to these standards. Once supplier performance is measured, the Postal Service may choose to recognize and reward outstanding suppliers to cultivate the supplier/purchaser relationship. Determining what to measure is the most important challenge of evaluating supplier performance. The metrics used to measure supplier performance should be simple and SMART:
Specific — metrics are specific and targeted to the area measured.
Measurable — data that are accurate and complete can be collected.
Actionable — easy to understand and clear, when performance is charted over time, which direction is “good” and which direction is “bad”.
Relevant — do not measure everything, but only things that are important.
Timely — measures for which data are available when needed.