Supplier Management | IT Process Wiki (2024)

• 1 Process Description
• 2 Sub-Processes
• 3 Definitions
• 4 Templates | KPIs
• 5 Roles | Responsibilities
• 6 Notes

These are the ITIL Supplier Management sub-processes and their process objectives:

Providing the Supplier Management Framework

• Process Objective: To provide guidance and standards for the procurement of services and products. This includes the provision of the Supplier Strategy and the preparation of standard Terms and Conditions.

Evaluation of new Suppliers and Contracts

• Process Objective: To evaluate prospective suppliers in accordance with the Supplier Strategy, and to select the most suitable supplier.

Establishing new Suppliers and Contracts

• Process Objective: To negotiate and sign a binding contract with a supplier. This process is mainly applied for significant investments, either in externally provided services or in technology.

Processing of Standard Orders

• Process Objective: To process orders for commodity products and services, and to order pre-defined items within the boundaries of existing contract frameworks.

Supplier and Contract Review

• Process Objective: To verify if the contractually agreed performance is actually delivered, and to define improvement measures if required (see "Supplier and Contract Review")

Contract Renewal or Termination

• Process Objective: To carry out regular renewals of contracts, to assess if those contracts are still relevant, and to terminate contracts which are no longer needed.

The following ITIL terms and acronyms (information objects) are used in ITIL Supplier Management to represent process outputs and inputs:

Purchase Order

• An order for purchasing items from a supplier. If the order is for an externally supplied Supporting Service it is accompanied by an Underpinning Contract defining service level targets.

Purchase Request

• A request to purchase a service or a product from an external supplier, issued for example from Release Management during Service Build. Processing of a Purchase Request will generally proceed only if the requester also holds an approved budget for the purchase.

Standard Terms and Conditions

• A set of terms and conditions which are routinely attached to contracts and orders when procuring services or products.

Supplier and Contract Management Information System (SCMIS)

• The Supplier and Contract Management Information System is database or structured document used to manage suppliers and contracts throughout their lifecycle. The SCMIS contains key attributes of all contracts with suppliers, and should be part of the Service Knowledge Management System.
• Remark: In ITIL V3 (2007) the Supplier and Contract Management Information System was referred to as the Supplier & Contract Database (SCD).

Supplier and Contract Review Meeting Minutes

• The Supplier and Contract Review Meeting Minutes document achieved vs. agreed supplier performance. They also contain any identified supplier weaknesses and problems, as well as suggestions on how the situation could be improved.

Supplier Evaluation

• The resulting document from the Supplier Evaluation process, describing in detail the criteria used for evaluating and selecting a suitable supplier.

Supplier Service Level Report

• The Supplier Service Level Report gives insight into a service provider's external supplier's ability to deliver the agreed service quality. To this purpose, it compares the agreed and actually achieved service levels, and also includes information on the usage of services, ongoing measures for service improvement, and any exceptional events.

Supplier Strategy

• The Supplier Strategy sets guidelines for the procurement of services and goods. It typically includes criteria for the selection of suitable suppliers and a list of preferred suppliers.

Underpinning Contract (UC)

• A contract between an IT service provider and a third party. The third party provides supporting services that enable the service provider to deliver a service to a customer. Therefore, Underpinning Contracts must be aligned with the customer-facing Service Level Agreements (see also: ITIL Checklist Underpinning Contract - UC).