Vendor Qualification, Performance, and Contract Compliance Management

Supply Chain Management and Procurement October 25, 2025
Enquire About This Course

Introduction

This critical course provides a detailed methodology for managing the entire supplier lifecycle, focusing on **Vendor Qualification, Performance Management, and Contract Compliance**. The relationship with key suppliers is a primary source of organizational risk and opportunity, making structured management essential. Participants will learn how to design rigorous qualification processes, implement data-driven performance scorecards, and enforce compliance with legal, ethical, and service terms within contracts. The course emphasizes building collaborative relationships that maximize value while strictly protecting the organization's interests.

Objectives

Upon completion of this course, participants will be able to:

  • Design a multi-stage **Vendor Qualification** process covering financial, ethical, and operational aspects.
  • Develop and utilize data-driven **Supplier Performance Scorecards** (KPIs) for objective evaluation.
  • Implement a structured **Supplier Relationship Management (SRM)** framework (e.g., Kraljic Matrix).
  • Master techniques for monitoring and ensuring **Contract Compliance** on price, quality, and service levels.
  • Establish effective corrective action plans (CAPs) and supplier improvement programs.
  • Analyze the legal mechanisms for handling supplier non-compliance and disputes.
  • Conduct objective and productive **Supplier Business Reviews (SBRs)** to drive continuous improvement.
  • Manage the risk associated with single sourcing and critical vendor dependencies.

Target Audience

  • Vendor Managers and Relationship Leads
  • Supplier Quality Assurance (SQA) Professionals
  • Contract Administrators and Compliance Officers
  • Procurement and Sourcing Specialists
  • Risk Managers and Internal Auditors
  • Supply Chain and Operations Managers

Methodology

  • Group activity: designing a weighted supplier scorecard for a strategic category.
  • Case study analysis of a major contract compliance failure and the resulting legal action.
  • Role-playing a tough Supplier Business Review (SBR) focused on performance turnaround.
  • Individual exercise: drafting a Corrective Action Plan (CAP) for a consistently late supplier.
  • Workshop on techniques for effective supplier risk auditing.

Personal Impact

  • Expertise in building and maintaining strategic, value-driven supplier relationships.
  • Enhanced analytical skills for data-driven supplier performance evaluation.
  • Ability to rigorously enforce contract terms and minimize compliance risk.
  • Increased standing as a professional capable of minimizing supply chain disruption.
  • Confidence in leading high-stakes supplier review and improvement discussions.

Organizational Impact

  • Minimized organizational risk through robust vendor qualification and due diligence.
  • Higher quality and on-time delivery from the supply base due to performance monitoring.
  • Guaranteed realization of contract value (price, rebates, service levels).
  • Sustained competitive advantage through collaborative supplier innovation.
  • Reduced costs associated with poor quality, delays, and non-compliance.

Course Outline

Unit 1: Strategic Supplier Segmentation and Qualification

Supplier Relationship Framework
  • Using the **Kraljic Matrix** (leverage, strategic, routine, bottleneck) to segment the supply base
  • Tailoring relationship management and engagement intensity based on segmentation
Vendor Qualification Mastery
  • Designing the qualification checklist: financial stability, technical capacity, legal compliance
  • Conducting due diligence, site visits, and ethical/social compliance audits

Unit 2: Performance Measurement and Scorecarding

KPI Development
  • Defining objective, quantifiable KPIs across key dimensions (Quality, Cost, Delivery, Service)
  • Weighting and scoring KPIs to reflect strategic priorities and category risk
  • The importance of consistent data collection and integration (ERP, supplier portals)
Supplier Business Reviews (SBRs)
  • Structuring the SBR agenda for accountability and forward-looking strategy
  • Techniques for delivering constructive feedback and managing supplier defensiveness

Unit 3: Contract Compliance and Governance

Monitoring Compliance
  • Auditing contract terms (price adherence, rebates, volume commitments)
  • Tracking service level agreement (SLA) performance and calculating penalties/rewards
  • Ensuring legal and regulatory compliance (e.g., certifications, environmental standards)
Managing Non-Compliance
  • Developing a staged process for addressing non-performance (warnings, improvement plans)
  • Understanding legal recourse: termination clauses, breach of warranty, liquidated damages

Unit 4: Driving Supplier Improvement

Supplier Development Programs
  • Identifying and selecting strategic suppliers for joint process improvement initiatives
  • Implementing **Corrective Action Plans (CAPs)** to address performance gaps
  • Techniques for joint goal setting and collaborative problem-solving
Risk and Continuity
  • Monitoring critical single-source vendors and developing risk diversification plans
  • Ensuring supplier adherence to business continuity and disaster recovery plans

Unit 5: Digital Tools and Relationship Strategy

Technology in SRM
  • Leveraging Supplier Relationship Management (SRM) software platforms
  • Utilizing supplier portals for self-service data updates and performance transparency
Value-Based Relationships
  • Moving beyond cost focus to collaborative innovation and continuous improvement
  • Managing the exit process for non-performing or non-compliant vendors

Ready to Learn More?

Have questions about this course? Get in touch with our training consultants.

Submit Your Enquiry