Did you know that according to a recent CPO survey, a majority of Chief Procurement Officers have mixed outlooks in regards to the effectiveness of their procurement departments? With a value proposition of organizational enablers and departmental unifiers with major impact on the bottom line, strategic sourcing and procurement groups should inspire confidence in their CPOs. So, what can SS&P do to improve performance? We’ve pulled together five tips for bolstering performance, including enhancing supplier relationships, establishing the right KPIs, and leveraging the right external support.

Do you have strategic relationships with your key suppliers? 

When was the last time you had an open dialogue with them? 
Was it the last time your contract was up for renewal? 

If so, you could be missing out on major opportunities for your company. A supplier relationship management program improves the workflow with vendors and third party groups. SRM is based on a conjoint set of processes and practices that compel constant open communication between the supplier and the buyer. Strategic Sourcing and Procurement uses principles, communications, processes, and other tools to fix shortcomings and improve performance.

How do you measure your Procurement Organization’s success? 
Is it strictly based on savings? 
Are your metrics aligned to your company’s overall mission? 

Assessing Key Performance Indicators allows for distinguishing and tracking key metrics that warrant procurement efficiency. KPIs can result in the company’s development of revenue and could be used to drive business objectives. For example, reducing the costs of product and service production allows for an increase in market share. While savings is a major driver for many procurement organizations, there are countless other ways to measure the value delivered by SS&P groups.

Is your procurement organization fully equipped to handle both tactical and strategic tasks? 
Do you have a partner that can help your organization with both? 
Do they offer flexible support catering to your fluctuating procurement needs?

Procurement departments can get external support by choosing the right outsourcing model to elevate staff’s productivity by transferring certain tasks that can be done more resourcefully by a third party. Companies can elevate themselves to the next level by partnering with outsource procurement service providers to access crucial market intelligence, industry best practices, and onsite and implementation support. One stop shop providers allow companies to save time and resources by providing support services such as processes, expertise, marketing knowledge, and people; wherever and however you need it. 

These are just the tip (pun intended) of iceberg of the ways in which procurement organizations can boost performance. Check out the infographic for more!

Share To:

Strategic Sourceror

Post A Comment:

0 comments so far,add yours