The Supplier Scorecard Turning Vendor Reviews Into Growth Opportunities: Building a Better Supplier Scorecard Presenters: Lindsey Sheeran, MBA, Sr. Category Manager, Mayo Clinic Nancy Wobig, MSM, Director, Category Management, Mayo Clinic This is the Title slide Please do not alter the Track Name

FACULTY DISCLOSURE The faculty reported the following financial relationships or relationships to products or devices they or their spouse/life partner have with commercial interests related to the content of this CE activity: Nancy Wobig - None Lindsey Sheeran - None This slide is for internal use. Please do not alter.

Learning Objectives Develop an effective approach to enhancing supplier relationships within your facilities, including stakeholders and all areas of supply chain. Identify a process for gathering, scoring and discussing results of five key performance categories Discuss a tool that can be used to measure, communicate and create next steps for improving supplier performance.

Nuts and Bolts – the Scorecard Supplier Feedback Q&A Agenda Mayo Clinic Scorecard Overview Purpose and Intent Supplier Segmentation/ Determination Nuts and Bolts – the Scorecard Supplier Feedback Q&A

Nuts and Bolts – the Scorecard Supplier Feedback Q&A Agenda Mayo Clinic Scorecard Overview Purpose and Intent Supplier Segmentation/ Determination Nuts and Bolts – the Scorecard Supplier Feedback Q&A

Mayo Clinic Charitable, not for profit, academic medical center Ranked #1 best hospital in the US by U.S. News & Report 3,800 physicians and scientists: 2,750 residents, fellows and students 54,800 total personnel 4,275 licensed beds – 24 hospitals in 6 states Provide essential health care services to 1 million patients annually from more than 135 countries

Nuts and Bolts – the Scorecard Supplier Feedback Q&A Agenda Mayo Clinic Scorecard Overview Purpose and Intent Supplier Segmentation/ Determination Nuts and Bolts – the Scorecard Supplier Feedback Q&A

Supplier Scorecard Purpose and Intent Ensure suppliers are working and focusing on what is important to Mayo Clinic Share Mayo Clinic’s strategic plan, goals and objectives Every organization must determine these criteria Build stronger relationships with suppliers Action plans and check point dates established Transparency to supplier How are they doing? How are they viewed? What can they improve? How can they partner?

Category Management Process Strategic Suppliers Operational Transactional Supplier Relationship Management Workgroup Leadership support Enhance relationships Supplier Segmentation

Strategic Supplier Determination Every contracting unit reviews supplier listing to determine where each supplier falls Criteria include: Dollars spent with supplier Number of contracts with supplier Type of products or services purchased from supplier Supplier desire to partner differently with Mayo

Nuts and Bolts – the Scorecard Supplier Feedback Q&A Agenda Mayo Clinic Scorecard Overview Purpose and Intent Supplier Segmentation/ Determination Nuts and Bolts – the Scorecard Supplier Feedback Q&A

The Nuts and Bolts of the Scorecard Establish Performance Metrics Need to be measurable Need to be objective Need to obtain input from stakeholders / Supply Chain Differentiate Direct vs Distributed products Differentiate Products vs Services

The Scorecard….. Performance Category Supply Chain operating goal definitions Weight Product quality Quality products are being provided with no recalls and minimal product issues. 25 Operational efficiency Technology is used for efficiencies, supply disruptions are limited and pricing is maintained. Price competitiveness Maintain price leadership and value proposition. Customer service Stakeholders and Supply Chain staff are receiving the support and partnership that is needed. 15 Adherence to policies / guidelines Mayo’s policies and guidelines are followed. 10

Product Quality FDA Recalls Manufacturing Recalls Mayo (internal) Recalls Mayo Product Incident Reports

Operational Efficiency This section is the area that changes to accommodate the variables of direct vs. distributed, products vs services. Perfect Order Backorders Firm Pricing Freight Program Payment Terms Service Fees

Price Competitiveness Accurate/Timely Payment of Rebates Price and Value Competitiveness - Pricelynx Vizient Supplier/ Enhanced Vizient contract

Customer Service Professionalism Effectiveness of Account or Corporate Executive IDN Leadership Responsiveness Adherence to Commitments Sales Professional’s Knowledge

Performance Category Definition Scale Scoring Detail Points Possible Points Achieved Comments/Action Item Assigned To Due Date Customer Service Professionalism: Exceeds Expectations = 3 pts Overall positive feedback on reps, Jamie Bowles does a great job along with Katie Olson 3 2 Jason Will talk to Katrina and look at sales support model for Mayo (possibly by population). Ray will schedule time with Terri to discuss.  Ray/Terri 3/25/2016 Does this vendor display professionalism during day to day Meets Expectations = 2 pts interactions, including stressful challenges? Needs Improvement = 1 pt 1 Not Acceptable = 0 pts Effectiveness of Account or Corporate Executive IDN Leadership: Continues to partner with Mayo on corporate directives. Need more proative communication. Losing local representation on needles left a void that Ray couldn't fill and the support structure wasn't available right away.   Does this vendor have a single point of contract who Put together a plan for who should communicate with who  Ray/Nancy 4/15/2016 participated effectively in the IDN (Integrated Delivery Network) environment? Responsiveness: Meets expectations Identify a way to provide proactive communication on backorders and company changes.  Ray 6/1/2016 Does this vendor respond to emails or phone calls in a time frame that meets your needs, including urgent situations? Adherence to Deadlines: Deadlines are met Does this vendor keep commitment regarding product delivery and information exchange? Sales Rep Knowledge: Very knowledgeable on the product lines that are supported Does the Representative you are assigned to work w/, have acceptable product knowledge and the ability to get the job done within the mayo system? 15 18 10

Has it worked? Created a Corporate Overlay Agreement Met with Marketing and key executives to provide feedback on product issues, backorders and proactive communication Received Tier 2 diversity spend Educated sales reps on working across all Mayo locations Adjusted pricing and structure of agreements

Nuts and Bolts – the Scorecard Supplier Feedback Q&A Agenda Mayo Clinic Scorecard Overview Purpose and Intent Supplier Segmentation/ Determination Nuts and Bolts – the Scorecard Supplier Feedback Q&A

What do the suppliers think? “Going through the scorecard review process allows for both parties to have an open discussion on where they are well together were there are opportunities for improvement. This open dialog strengthens the supplier relationship and sets clear expectations for the future. We are looking forward to our next review.” We appreciate the transparency and direct feedback the scorecard affords. It provides clear direction and drives a more aligned partnership. It enables us as a strategic partner to continuously improve.” “Strategic Relationships are built on honesty and trust and it is important to have direct dialogue on where you stand and communicate with each other what is important to both parties.  The Supplier Scorecard provides this information to us on what we do well and where we can improve.  We value this feedback from Mayo Clinic and are committed to work on any areas of improvement to enhance our Strategic Partnership. ”    “The scorecard clearly laid out what we were doing right and even more important, what we were doing wrong. As a supplier it is sometimes hard to discern if you are meeting all the expectations of your customer. The scorecard takes the guess work out of it, and gives you a road map to a stronger relationship.”

Q&A Slide

Mayo Clinic Team Lori Rainey – Medical Device (PPI) – Contract Portfolio Manager Jim Hall – Purchased Services – Unit Manager John Bloomquist – Purchased Services – Sr. Contract Portfolio Manager Marcy Benson – Capital – Contract Portfolio Manager

Questions? For more information contact: Lindsey Sheeran sheeran.lindsey@mayo.edu Nancy Wobig wobig.nancy@mayo.edu Q&A Slide