Question

A procurement manager has been tracking delivery performance of her suppliers. Based on the following data 1. Calculate sigma performance of these suppliers using Z Score tables and rank order them 2. Comment on the performance of these suppliers Supplier A B C Number of deliveries 25 54 70 Number of late deliveries 3 10 12 .

Answer 1

Supplier	Number of deliveries	Number of late deliveries	Proportion of late deliveries
A	25	3	0.12
B	54	10	0.185
C	70	12	0.171

The mean proportion of late deliveries = ( 0.12 + 0.185 + 0.171 ) 3

The mean proportion of late deliveries = 0.159

The standard devation of the proportion of late deliveries =

The standard devation of the proportion of late deliveries =

The standard devation of the proportion of late deliveries = 0.03

The Z score of suppler A = ( p - ) SD

The Z score of suppler A = ( 0.12 - 0.159) 0.03

The Z score of suppler A = -1.3

The probability that supplier A delivers late = 0.1515

The Z score of suppler B = ( p - ) SD

The Z score of suppler B = ( 0.185 - 0.159) 0.03

The Z score of suppler B = 0.86

The probability that supplier B delivers late = 0.8051

The Z score of suppler C = ( p - ) SD

The Z score of suppler C = ( 0.171 - 0.159) 0.03

The Z score of suppler C = 0.4

The probability that supplier C delivers late = 0.6554

Supplier	Ranking
A	1
B	3
C	2