How do you evaluate a new contractor?

The Altius supply chain performance framework is a tool that’s designed to improve and simplify the process of evaluating new contractors.

It pins down assessment to three key areas of: capability, management and monitoring.

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Capability

To judge contractor capability effectively, you should:

  • Be clear on the information you need initially from each contractor, based on the work they carry out. Make it as easy as possible for them to submit the information to you, and where possible, use closed questions to gain clarity.
  • Get Verification of the contractor’s industry certifications and other regulatory paperwork to validate they are capable of working for you. Use a robust and thorough IT system to collate this information and remember that certifications do expire, ask yourself how you will keep on top of this to protect your business.
  • ‘Spread the word’ once a contractor is authorised, make sure everyone in your business knows that they are approved and are available to use, especially your procurement team.

Management

The job of managing compliance extends well beyond the basics of information and evidence gathering for authorisation to work. Ongoing management of contractors is required to ensure that contractual compliance is adhered to. For new and existing suppliers, you should give them the relevant policy, rules and specifications to help them stay compliant. Your job at this stage is to monitor that they are doing this correctly and on time.

To manage new contractors effectively, you should:

  • Create policies that clearly explain what you want to see. Communicate these regularly so contractors are familiar with them and ensure you have a system or procedure in place to share these policies, as well as having the ability to collect ‘acknowledgements’ once the contractor has read and understood the documents.
  • Clearly communicate what you expect new contractors to deliver and what they should not be doing. Include everything, from the timescales of the work, to the behaviour you expect from their staff. Make sure they understand these controls, for example, site access rules, before they start work and record that they’ve agreed to them.

Monitoring

To ensure that your contractor abides by your contractual agreements and meets their targets, you need to have a system in place so that you can monitor their progress continually. This can be in the form of an audit which will assist in identifying areas for improvement, as well as assessing performance.

To monitor and evaluate the performance of new contractors, you should:

  • Observe contractors whilst they are working for you. Give feedback and praise for good behaviour to encourage them to continue working in the right way.
  • Consistently Audit to check progress and ensure they are following the agreed processes.
  • Use KPIs to provide routine feedback on how your contractors are doing. Look for trends over time and assess whether the new supplier is achieving what you expect. Make sure these results are shared with contractors so they understand where they can improve.

Find out more about Altius’ specialist compliance software for contractor assessment and management

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