• which are the most important KPI in Procurement/Supply Chain?

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  • Answers (11)

  • Angus Craig

    22/10/2018 07:39AM

    Savings are the most common KPI. Number of vendors is also very common. Then depending on the organisation maturity, there may be KPIs on the source to contract process (eg number of tenders issued, time taken from start to finish, number of contracts placed) and the P2P process (eg time taken to process, days to pay).

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  • Bobhenry Onyeukwu MCIPS, SCMA

    22/10/2018 02:22AM

    Lead Time, Vendor Compliance, Savings

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  • James Ball

    27/10/2018 08:22AM

    In year delivered savings is the most important Procurement KPI (ideally savings that are trackable to future budget reductions for equal/greater goods/services). That is not belittling all other important KPIs or value adds from Procurement, but is still seen by business stakeholders as the greatest metric for Procurement to justify the businesses investment in the function. Different organisations will support Procurement place greater or equal value on other metrics or innovations, but to answer the exam question, savings remains No.1. After savings; P2P and contract compliance (both with different drivers to measure for different organisations).

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    Katalin Brennan Good or bad, most CPO surveys (Hackett, Deloitte, etc.) confirm this.

    27/10/2018 01:22PM

  • Richa Singh

    23/10/2018 02:46PM

    The current important kpis will change significantly with availability of smarter data analysis and the advent of technologies such as AI, Blockchain. It would be important to measure innovation, risks etc and quantify everything.

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  • Chris Cliffe FCIPS MIoD

    22/10/2018 10:09PM

    Most important KPI is tracking whether your stakeholders met their KPIs and our contribution to that.

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  • Bennett Glace

    22/10/2018 07:54PM

    Cost savings and cost avoidance are (understandably) big ones, but truly world-class organizations are tracking their departments on far more. Check out our infographic on relevant Procurement metrics to learn more. https://www.strategicsourceror.com/2018/09/procurement-metrics-101.html

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  • Hugo Britt

    22/10/2018 12:38AM

    Check out Tania Seary's article on Procurement KPIs: https://www.procurious.com/procurement-news/less-power-good-kpi

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  • Marco Francisco

    19/10/2018 02:15PM

    Currently, tracking payment terms is the most important indicator. Also, I include to watch the progress of implemented savings.

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  • Katalin Brennan

    24/10/2018 08:18PM

    Being on the solution provider side of procurement, I've seen clients focusing on different KPIs. The truth is, no company operates the same way, and all companies have their unique set of organizational, technological and personnel composition. My standard advice to all is to pick no more than three KPIs and measure the heck out of it until they have a good handle on the particular area. Then, when they dialed in a few, proceed to focus on new KPIs. While cost savings and operational efficiencies are shared by most, optimization of too many additional factors is nearly impossible... success or failure, if you can't pinpoint the cause you can't reinforce or avoid the underlying action.

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  • Cornelius Du Preez

    24/10/2018 02:42PM

    Well, procurement as the strategic embodiment of 'operational purchasing' will have to ascertain the level of success obtained employing the implemented procurement strategies guiding 'operational purchasing'. Focusing on the alignment between strategy and operations in areas such as TCO, quality, delivery, favourable payment periods, and ... Procurement as a strategic supply chain contributor will have to quantify the cost that it removed from the supply chain by working with internal and external supply chain suppliers to remove waste from the overall supply chain. What did Procurement do to CUT COST out of the supply chain, should be the question, not how far up the supply chain can cost be passed?

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  • Hugo Britt

    22/10/2018 12:39AM

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