Boost Your Procurement Value Engine I wwwpool4toolcom

1

BOOST YOUR

How to upgrade effectiveness efficiency and sustainability

PROCUREMENTVALUE ENGINE

B Maltaverne amp M Lamoureux

Boost Your Procurement Value Engine I wwwpool4toolcom

2Table of Contents

Table of Contents

The Purpose of Your Procurement Function 3

The Procurement Value Engine 4

Effectiveness and Efficiency 5

The Productivity Plateau 5

Sustainable Productivity 7

Increasing the Value-for-Money (VfM) of Procurement 8

Definition of Value 8

Effective Procurement 9

Efficient Procurement 11

Sustainable Procurement 14

Boost Your Procurement Value Engine I wwwpool4toolcom

3

The Purpose of Your Procurement Function

A modern Procurement function exists to identify and drive organizational value Long gone are the days when Procurementrsquos only role was to process the paperwork that allowed the manufacturing department to buy the parts it needed to make its product or the back office to continue the day-to-day accounting

However as we will discuss in this white paper the identification of organizational value which is the ultimate key to organizational success is not always straight-forward Every organization is different and every Procurement function has a different level of maturity

While every function exists to deliver results not every function takes the time required to understand the why Not only does this give purpose to the function (and a lot has been written on the importance of purpose in management) but it also defines the true role of the function within the organization the what

But now we live in times where the how also matters It is obvious that delivering results (the what) to achieve organizational value is key (the why) But how you achieve these results also matters In Procurement the how depends on the level of organizational maturity and what will have the greatest impact

Value mgmt

Price

Demand management

Supply assurance

Total cost of ownership

Source Hackett Group

Right goods services at the

right time and place

Buyerplanner

Right goods and services at the right right price

Negotiator

Shift from lowest price to TCO

Supply expert team leader project manager

Reduce demand activity com-pexity and variability

Spendbudget consultant and relationship manager

Increase business value derived from spend

Value Proposition Role of Procurement

Trusted business advisor and change agent

The Purpose of Your Procurement Function

Boost Your Procurement Value Engine I wwwpool4toolcom

4

We can measure the maturity of the organization using the hierarchy of supply provided to us by Hackett But while this specifies what the Procurement function can do it doesnrsquot specify what the Procurement function should do

We can therefore define the raison drsquoecirctre of a Procurement function as what the Procurement function should do And what should the Procurement function do Simply put Procurement should reinforce a companyrsquos Unique Selling Points (USPs) or Unique Value Propositions (UVPs) and competitive advantage by managing external spend with the appropriate strategy In this paper we will define a process that can be used to both define and execute the right strategy for each Procurement event

Sustainability

Efficiency

Effectiveness

Efficient(Doing the things right)

Sustainability (Continuously)

Effective (Doing the right things)

The sweet spot

The Procurement Value Engine

To make a comparison with the ma-nufacturing world Procurement is analogous to an engine The purpose of the engine is to produce the fuel that powers the vehicle it is cont-ained within To do so Procurement requires Energy The energy among other things consists of the function itself (the people) and everything the Procurement function needs to work (time information systems etc) The less energy the engine needs the better

But this is not the whole story The engine must run and continue to

perform at an optimum level of pro-ductivity over time and do so in a sustainable manner

A best-in-class Procurement function is thus a function whose Value Engi-ne continuously delivers value (it is sustainable) to other departments stakeholders (it is effective) while requiring minimum energy (it is effi-cient)

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

5

Input Output

Ener

gy

Process

Fail slowly Excel

Fail fast Survive

Effectiviness

Effic

ienc

y

Effectiveness and Efficiency

Now that we have defined the Procurement Value Engine it is important to understand what its key performance indicators (KPIs) are Like any engine the two main KPIs are effectiveness and efficiency

Effectiveness is about producing an expected result The gap between the target and the actual result defines the level of performance

Efficiency has nothing to do with the result itself but focuses on what is required in terms of resources to produce it Therefore ldquothe less the betterrdquo is definitely the objective of increa-sing efficiency

The Productivity Plateau

Now that we have identified the two primary KPIs for the Procurement Value Engine we can explore how they relate to each other and what best-in-class or-ganizations should aim for

As illustrated to the left the Holy Grail is to be effective AND efficient

It is no big surprise that the way a com-pany maximizes its return on invest-ment (ROI) for its Procurement function is to increase efficiency and effective-ness However as explained in a recent article on Spend Mattersrsquo website Chief Procurement Officer it is often difficult if not impossible to simultaneously ma-

ximize both Nonetheless as the article points out there is a symbiotic relationship between effectiveness and efficiency and a failure to grasp this could result in an organization pursuing a plateau that it might not be able to reach

The Procurement Value Engine

Effectiveness

Efficiency

Boost Your Procurement Value Engine I wwwpool4toolcom

2Table of Contents

Table of Contents

The Purpose of Your Procurement Function 3

The Procurement Value Engine 4

Effectiveness and Efficiency 5

The Productivity Plateau 5

Sustainable Productivity 7

Increasing the Value-for-Money (VfM) of Procurement 8

Definition of Value 8

Effective Procurement 9

Efficient Procurement 11

Sustainable Procurement 14

Boost Your Procurement Value Engine I wwwpool4toolcom

3

The Purpose of Your Procurement Function

A modern Procurement function exists to identify and drive organizational value Long gone are the days when Procurementrsquos only role was to process the paperwork that allowed the manufacturing department to buy the parts it needed to make its product or the back office to continue the day-to-day accounting

However as we will discuss in this white paper the identification of organizational value which is the ultimate key to organizational success is not always straight-forward Every organization is different and every Procurement function has a different level of maturity

While every function exists to deliver results not every function takes the time required to understand the why Not only does this give purpose to the function (and a lot has been written on the importance of purpose in management) but it also defines the true role of the function within the organization the what

But now we live in times where the how also matters It is obvious that delivering results (the what) to achieve organizational value is key (the why) But how you achieve these results also matters In Procurement the how depends on the level of organizational maturity and what will have the greatest impact

Value mgmt

Price

Demand management

Supply assurance

Total cost of ownership

Source Hackett Group

Right goods services at the

right time and place

Buyerplanner

Right goods and services at the right right price

Negotiator

Shift from lowest price to TCO

Supply expert team leader project manager

Reduce demand activity com-pexity and variability

Spendbudget consultant and relationship manager

Increase business value derived from spend

Value Proposition Role of Procurement

Trusted business advisor and change agent

The Purpose of Your Procurement Function

Boost Your Procurement Value Engine I wwwpool4toolcom

4

We can measure the maturity of the organization using the hierarchy of supply provided to us by Hackett But while this specifies what the Procurement function can do it doesnrsquot specify what the Procurement function should do

We can therefore define the raison drsquoecirctre of a Procurement function as what the Procurement function should do And what should the Procurement function do Simply put Procurement should reinforce a companyrsquos Unique Selling Points (USPs) or Unique Value Propositions (UVPs) and competitive advantage by managing external spend with the appropriate strategy In this paper we will define a process that can be used to both define and execute the right strategy for each Procurement event

Sustainability

Efficiency

Effectiveness

Efficient(Doing the things right)

Sustainability (Continuously)

Effective (Doing the right things)

The sweet spot

The Procurement Value Engine

To make a comparison with the ma-nufacturing world Procurement is analogous to an engine The purpose of the engine is to produce the fuel that powers the vehicle it is cont-ained within To do so Procurement requires Energy The energy among other things consists of the function itself (the people) and everything the Procurement function needs to work (time information systems etc) The less energy the engine needs the better

But this is not the whole story The engine must run and continue to

perform at an optimum level of pro-ductivity over time and do so in a sustainable manner

A best-in-class Procurement function is thus a function whose Value Engi-ne continuously delivers value (it is sustainable) to other departments stakeholders (it is effective) while requiring minimum energy (it is effi-cient)

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

5

Input Output

Ener

gy

Process

Fail slowly Excel

Fail fast Survive

Effectiviness

Effic

ienc

y

Effectiveness and Efficiency

Now that we have defined the Procurement Value Engine it is important to understand what its key performance indicators (KPIs) are Like any engine the two main KPIs are effectiveness and efficiency

Effectiveness is about producing an expected result The gap between the target and the actual result defines the level of performance

Efficiency has nothing to do with the result itself but focuses on what is required in terms of resources to produce it Therefore ldquothe less the betterrdquo is definitely the objective of increa-sing efficiency

The Productivity Plateau

Now that we have identified the two primary KPIs for the Procurement Value Engine we can explore how they relate to each other and what best-in-class or-ganizations should aim for

As illustrated to the left the Holy Grail is to be effective AND efficient

It is no big surprise that the way a com-pany maximizes its return on invest-ment (ROI) for its Procurement function is to increase efficiency and effective-ness However as explained in a recent article on Spend Mattersrsquo website Chief Procurement Officer it is often difficult if not impossible to simultaneously ma-

ximize both Nonetheless as the article points out there is a symbiotic relationship between effectiveness and efficiency and a failure to grasp this could result in an organization pursuing a plateau that it might not be able to reach

The Procurement Value Engine

Effectiveness

Efficiency

Boost Your Procurement Value Engine I wwwpool4toolcom

3

The Purpose of Your Procurement Function

A modern Procurement function exists to identify and drive organizational value Long gone are the days when Procurementrsquos only role was to process the paperwork that allowed the manufacturing department to buy the parts it needed to make its product or the back office to continue the day-to-day accounting

However as we will discuss in this white paper the identification of organizational value which is the ultimate key to organizational success is not always straight-forward Every organization is different and every Procurement function has a different level of maturity

While every function exists to deliver results not every function takes the time required to understand the why Not only does this give purpose to the function (and a lot has been written on the importance of purpose in management) but it also defines the true role of the function within the organization the what

But now we live in times where the how also matters It is obvious that delivering results (the what) to achieve organizational value is key (the why) But how you achieve these results also matters In Procurement the how depends on the level of organizational maturity and what will have the greatest impact

Value mgmt

Price

Demand management

Supply assurance

Total cost of ownership

Source Hackett Group

Right goods services at the

right time and place

Buyerplanner

Right goods and services at the right right price

Negotiator

Shift from lowest price to TCO

Supply expert team leader project manager

Reduce demand activity com-pexity and variability

Spendbudget consultant and relationship manager

Increase business value derived from spend

Value Proposition Role of Procurement

Trusted business advisor and change agent

The Purpose of Your Procurement Function

Boost Your Procurement Value Engine I wwwpool4toolcom

4

We can measure the maturity of the organization using the hierarchy of supply provided to us by Hackett But while this specifies what the Procurement function can do it doesnrsquot specify what the Procurement function should do

We can therefore define the raison drsquoecirctre of a Procurement function as what the Procurement function should do And what should the Procurement function do Simply put Procurement should reinforce a companyrsquos Unique Selling Points (USPs) or Unique Value Propositions (UVPs) and competitive advantage by managing external spend with the appropriate strategy In this paper we will define a process that can be used to both define and execute the right strategy for each Procurement event

Sustainability

Efficiency

Effectiveness

Efficient(Doing the things right)

Sustainability (Continuously)

Effective (Doing the right things)

The sweet spot

The Procurement Value Engine

To make a comparison with the ma-nufacturing world Procurement is analogous to an engine The purpose of the engine is to produce the fuel that powers the vehicle it is cont-ained within To do so Procurement requires Energy The energy among other things consists of the function itself (the people) and everything the Procurement function needs to work (time information systems etc) The less energy the engine needs the better

But this is not the whole story The engine must run and continue to

perform at an optimum level of pro-ductivity over time and do so in a sustainable manner

A best-in-class Procurement function is thus a function whose Value Engi-ne continuously delivers value (it is sustainable) to other departments stakeholders (it is effective) while requiring minimum energy (it is effi-cient)

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

5

Input Output

Ener

gy

Process

Fail slowly Excel

Fail fast Survive

Effectiviness

Effic

ienc

y

Effectiveness and Efficiency

Now that we have defined the Procurement Value Engine it is important to understand what its key performance indicators (KPIs) are Like any engine the two main KPIs are effectiveness and efficiency

Effectiveness is about producing an expected result The gap between the target and the actual result defines the level of performance

Efficiency has nothing to do with the result itself but focuses on what is required in terms of resources to produce it Therefore ldquothe less the betterrdquo is definitely the objective of increa-sing efficiency

The Productivity Plateau

Now that we have identified the two primary KPIs for the Procurement Value Engine we can explore how they relate to each other and what best-in-class or-ganizations should aim for

As illustrated to the left the Holy Grail is to be effective AND efficient

It is no big surprise that the way a com-pany maximizes its return on invest-ment (ROI) for its Procurement function is to increase efficiency and effective-ness However as explained in a recent article on Spend Mattersrsquo website Chief Procurement Officer it is often difficult if not impossible to simultaneously ma-

ximize both Nonetheless as the article points out there is a symbiotic relationship between effectiveness and efficiency and a failure to grasp this could result in an organization pursuing a plateau that it might not be able to reach

The Procurement Value Engine

Effectiveness

Efficiency

Boost Your Procurement Value Engine I wwwpool4toolcom

4

We can measure the maturity of the organization using the hierarchy of supply provided to us by Hackett But while this specifies what the Procurement function can do it doesnrsquot specify what the Procurement function should do

We can therefore define the raison drsquoecirctre of a Procurement function as what the Procurement function should do And what should the Procurement function do Simply put Procurement should reinforce a companyrsquos Unique Selling Points (USPs) or Unique Value Propositions (UVPs) and competitive advantage by managing external spend with the appropriate strategy In this paper we will define a process that can be used to both define and execute the right strategy for each Procurement event

Sustainability

Efficiency

Effectiveness

Efficient(Doing the things right)

Sustainability (Continuously)

Effective (Doing the right things)

The sweet spot

The Procurement Value Engine

To make a comparison with the ma-nufacturing world Procurement is analogous to an engine The purpose of the engine is to produce the fuel that powers the vehicle it is cont-ained within To do so Procurement requires Energy The energy among other things consists of the function itself (the people) and everything the Procurement function needs to work (time information systems etc) The less energy the engine needs the better

But this is not the whole story The engine must run and continue to

perform at an optimum level of pro-ductivity over time and do so in a sustainable manner

A best-in-class Procurement function is thus a function whose Value Engi-ne continuously delivers value (it is sustainable) to other departments stakeholders (it is effective) while requiring minimum energy (it is effi-cient)

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

5

Input Output

Ener

gy

Process

Fail slowly Excel

Fail fast Survive

Effectiviness

Effic

ienc

y

Effectiveness and Efficiency

Now that we have defined the Procurement Value Engine it is important to understand what its key performance indicators (KPIs) are Like any engine the two main KPIs are effectiveness and efficiency

Effectiveness is about producing an expected result The gap between the target and the actual result defines the level of performance

Efficiency has nothing to do with the result itself but focuses on what is required in terms of resources to produce it Therefore ldquothe less the betterrdquo is definitely the objective of increa-sing efficiency

The Productivity Plateau

Now that we have identified the two primary KPIs for the Procurement Value Engine we can explore how they relate to each other and what best-in-class or-ganizations should aim for

As illustrated to the left the Holy Grail is to be effective AND efficient

It is no big surprise that the way a com-pany maximizes its return on invest-ment (ROI) for its Procurement function is to increase efficiency and effective-ness However as explained in a recent article on Spend Mattersrsquo website Chief Procurement Officer it is often difficult if not impossible to simultaneously ma-

ximize both Nonetheless as the article points out there is a symbiotic relationship between effectiveness and efficiency and a failure to grasp this could result in an organization pursuing a plateau that it might not be able to reach

The Procurement Value Engine

Effectiveness

Efficiency

Boost Your Procurement Value Engine I wwwpool4toolcom

5

Input Output

Ener

gy

Process

Fail slowly Excel

Fail fast Survive

Effectiviness

Effic

ienc

y

Effectiveness and Efficiency

Now that we have defined the Procurement Value Engine it is important to understand what its key performance indicators (KPIs) are Like any engine the two main KPIs are effectiveness and efficiency

Effectiveness is about producing an expected result The gap between the target and the actual result defines the level of performance

Efficiency has nothing to do with the result itself but focuses on what is required in terms of resources to produce it Therefore ldquothe less the betterrdquo is definitely the objective of increa-sing efficiency

The Productivity Plateau

Now that we have identified the two primary KPIs for the Procurement Value Engine we can explore how they relate to each other and what best-in-class or-ganizations should aim for

As illustrated to the left the Holy Grail is to be effective AND efficient

It is no big surprise that the way a com-pany maximizes its return on invest-ment (ROI) for its Procurement function is to increase efficiency and effective-ness However as explained in a recent article on Spend Mattersrsquo website Chief Procurement Officer it is often difficult if not impossible to simultaneously ma-

ximize both Nonetheless as the article points out there is a symbiotic relationship between effectiveness and efficiency and a failure to grasp this could result in an organization pursuing a plateau that it might not be able to reach

The Procurement Value Engine

Effectiveness

Efficiency

Efficiency is doing things right

effectiveness is doing the right things

raquo

raquoPeter Drucker Austrian-born American manage-

ment consultant educator and author He has

been described as ldquothe founder of modern ma-

nagementrdquo

Like Drucker POOL4TOOL was born in Vienna

Austria so we consider him a real inspiration

Boost Your Procurement Value Engine I wwwpool4toolcom

7

With a limited amount of energy (as defined earlier) your organization can only manage a cer-tain amount of input and produce a certain quantity of result This is where the organization reaches a productivity plateau To achieve an increase in results (or output) the only solution is to increase the level of energy which is very often translated as ldquomore peoplerdquo Another article from Spend Matters based on an APQC study on maverick buying illustrates this point

But is this really the only way to break the productivity plateau

There is another way As described in the article cited above you can ldquouse efficiency to fund ef-fectivenessrdquo Becoming more efficient will mean for example that people will do things faster The time freed up by an increase in efficiency can then be used to fuel effectiveness by being able to do and manage more In Procurement a typical example is using the newly available bandwidth to manage more spend and therefore produce new value incrementally But this is not enough to reach and maintain the optimal productivity plateau

Sustainable Productivity

The analogy of an engine again helps us to understand this because an engine needs constant care maintenance and fuel to run It is dynamic For many Procurement functions being self-aware is sometimes very difficult if not impossible because it requires

the right dashboard to measure changes in input output gap vs target

a lot of energy to gather data and perform the relevant analysis

Therefore in addition to effectiveness and efficien-cy the Procurement Value Engine must be sustain-able By sustainable we mean that Procurement should deliver value in the long run not just the short run This means ensuring that the triad of time cost and quality is always at its optimum and balanced

This third dimension of the Procurement Value Engi-ne has two main consequences

An approach and culture of continuous impro-vement (aka DMAIC)

An understanding of future impacts in all decisi-ons and actions (long-termism vs short-termism)

Time

Productivity

2 Cost

6 Talent4 Quality

3 Scope

1 Time

5 Risk

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

7

With a limited amount of energy (as defined earlier) your organization can only manage a cer-tain amount of input and produce a certain quantity of result This is where the organization reaches a productivity plateau To achieve an increase in results (or output) the only solution is to increase the level of energy which is very often translated as ldquomore peoplerdquo Another article from Spend Matters based on an APQC study on maverick buying illustrates this point

But is this really the only way to break the productivity plateau

There is another way As described in the article cited above you can ldquouse efficiency to fund ef-fectivenessrdquo Becoming more efficient will mean for example that people will do things faster The time freed up by an increase in efficiency can then be used to fuel effectiveness by being able to do and manage more In Procurement a typical example is using the newly available bandwidth to manage more spend and therefore produce new value incrementally But this is not enough to reach and maintain the optimal productivity plateau

Sustainable Productivity

The analogy of an engine again helps us to understand this because an engine needs constant care maintenance and fuel to run It is dynamic For many Procurement functions being self-aware is sometimes very difficult if not impossible because it requires

the right dashboard to measure changes in input output gap vs target

a lot of energy to gather data and perform the relevant analysis

Therefore in addition to effectiveness and efficien-cy the Procurement Value Engine must be sustain-able By sustainable we mean that Procurement should deliver value in the long run not just the short run This means ensuring that the triad of time cost and quality is always at its optimum and balanced

This third dimension of the Procurement Value Engi-ne has two main consequences

An approach and culture of continuous impro-vement (aka DMAIC)

An understanding of future impacts in all decisi-ons and actions (long-termism vs short-termism)

Time

Productivity

2 Cost

6 Talent4 Quality

3 Scope

1 Time

5 Risk

The Procurement Value Engine

Boost Your Procurement Value Engine I wwwpool4toolcom

8

Increasing the Value-for-Money (VfM) of Procurement

A better Procurement Engine is one that delivers more value-for-money (VfM) The Value-for-Money of Procurement can be defined as ldquoa utility derived from every purchase or every sum of money spent Value for money is based not only on the minimum purchase price (economy) but also on the maximum efficiency and effectiveness of the purchaserdquo1

Therefore VfM applied to Procurement is about maximizing value from each dollar invested in the Procurement functionrsquos people process and technology

At a high level the Procurement VfM can be described as

VfM levers = Reduce Input + Increase Output + Reduce Energy

Which leads us to the following breakdown

This means that an increase in effectiveness in any of these categories so long as it is not ac-companied by a decrease in effectiveness in another category will generally increase value for money But this breakdown doesnrsquot answer which increase will bring the greatest benefit or how Procurement can deliver the best value to organizational stakeholders

Definition of Value

Before you can deliver results you need to know what you are expected to deliver Or as the well-known negotiation concept puts it the receiving party defines what value is not the giver This means that value has to be determined by and with the ldquoend-userrdquo of the product or service that Procurement will be sourcing

As the CIPS model for Category Management shows this is a ldquotop-downrdquo approach that starts with a companyrsquos vision mission and values This then cascades to the level of the

Governance amp Category Mgmt SourcingSupply MgmtPurchase-to-Pay

Vfm = x x+ x x xReduce influence demand

Decrease contract

costs

Increase spend under management

Increase compliance

with contracts

Decrease order-to-pay

costs

Reduce usage costs

Reduce risk

Companyacutes Vision Mission amp Values

Procurement Strategy (Value)

Category Strategy

Category Strategy

Category Strategy

Companyacutes Overall Strategy

Finance

Supply Chain

HR

R amp D

Marketing

Technical

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

9

companyrsquos overall cross-functional strategy down to the category level at the end of the funnel

Obviously this is a function-specific exercise the outcome varies from company to company (as noted earlier the raison drsquoecirctre of Procurement is to reinforce a companyrsquos USPs) and as it is often said results may vary based on

Market and sector eg B2B B2C public private

Industry eg service manufacturing

Localization eg legal requirements

Nevertheless some common elements of relevance could be

Cost (performance profitability amp financials) eg price cost Total Cost of Ownership cash management growth

Agility contribute to supply chain rebalancing (buy where you sell) manage market dyna-mics (raw materials currencies etc) anticipate impact of disruptive technologies that may impact make-or-buy decisions andor supply markets contribute to time-to-market improvements etc

Risk reduction brand protection supply chain disruptions CSR etc

Effective Procurement

Effectiveness is where to start as illustrated in the quote above and in a recent Procurement book Procurement Mojo by Sigi Osagie

It is Procurementrsquos job to manage external spending so the key drivers of being effective are related to the Strategic Sourcing Processes A good start to assessing your current effectiveness is to look at AT Kearneyrsquos Strategic Sourcing Gemstone

McKinsey amp Company research has confirmed that procurement pays

Companies with high-performing procurement functions consistently

outperform their rivals on a range of financial indicators and the best

companies are building advanced talent management strategies into

the very heart of their procurement organizations Moreover procure-

ment will play a key role in helping companies cope with the new chal-

lenges and opportunities of our increasingly dynamic global economy

Industry Week ndash Jan 2014

raquo raquo

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

9

companyrsquos overall cross-functional strategy down to the category level at the end of the funnel

Obviously this is a function-specific exercise the outcome varies from company to company (as noted earlier the raison drsquoecirctre of Procurement is to reinforce a companyrsquos USPs) and as it is often said results may vary based on

Market and sector eg B2B B2C public private

Industry eg service manufacturing

Localization eg legal requirements

Nevertheless some common elements of relevance could be

Cost (performance profitability amp financials) eg price cost Total Cost of Ownership cash management growth

Agility contribute to supply chain rebalancing (buy where you sell) manage market dyna-mics (raw materials currencies etc) anticipate impact of disruptive technologies that may impact make-or-buy decisions andor supply markets contribute to time-to-market improvements etc

Risk reduction brand protection supply chain disruptions CSR etc

Effective Procurement

Effectiveness is where to start as illustrated in the quote above and in a recent Procurement book Procurement Mojo by Sigi Osagie

It is Procurementrsquos job to manage external spending so the key drivers of being effective are related to the Strategic Sourcing Processes A good start to assessing your current effectiveness is to look at AT Kearneyrsquos Strategic Sourcing Gemstone

McKinsey amp Company research has confirmed that procurement pays

Companies with high-performing procurement functions consistently

outperform their rivals on a range of financial indicators and the best

companies are building advanced talent management strategies into

the very heart of their procurement organizations Moreover procure-

ment will play a key role in helping companies cope with the new chal-

lenges and opportunities of our increasingly dynamic global economy

Industry Week ndash Jan 2014

raquo raquo

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

10

Consolidate number

of suppliers

Aggregate vo

lume accross u

nits

Redistribute vo

lume among

suppliers

Establish

develop key su

ppliers

Employ strategic

alliance

partnering

Examine strategic

ldquomake v buyrdquo

Conduct product value analysis

Optimise lifecycle costs

Rationalisestandardise

specifications

Substitute materials

Expand geographic supply base

Develop new suppliers

Exploit global supply demand

imbalances

Compare total costs

Model ldquoshould-costsrdquo

Renegotiate prices

Unbundle pricing

Hold an online auction

Re-engineer joint processes

Support supplier operations improvement

Share productivity gains

Develop integrated supply chain

To increase effectiveness as highlighted in the gemstone above the right measures aim to manage spend better and achieve more results by

Using historical spend to gain knowledge

Employing levers to reduce price or cost or eliminate cost and

Increasing spend under management to unlock new benefits

The following are examples of effectiveness levers based on the value for money formula presented earlier in this document

Demand Influence lifecycle cost analysis versus bonus potential

A full lifecycle cost analysis on similar product lines in a category might reveal that two al-most equal cellphone models have significantly different costs and one of the models should be retired with demand shifted to the other model But until sales understands the costs and how it impacts the bottom line and their bonus potential they might keep selling the higher cost model (instead of the higher profit model)

Spend Under Management (SUM) increase extendible on-line catalog for all types of requisitions

A big reason a lot of spend is not under management at many organizations is because there is no catalog for many one-off one-time or spot-buy purchase needs (such as extra office supplies not on the standard contract temporary services promotional items for events

Exercise Power Create Advantage

Volume

concentration

Product

specification

improvement

Product specification

improvement

Global sourcing

Joint process

improvement

Best-price evaluation

The strategic sourcing gemstone

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

11

travel services etc) and this spend ends up being requisitioned through e-mail requests made then is not entered in the Procurement system until the invoice comes in But if the organization has an extensive catalog where arbitrary items can be created by the or-ganization as needed all requisitions approval and spend gets recorded and gets under management

Contract Cost Decrease e-Signature options

Some organizations pay a lot of money couriering contracts back and forth for signature even when e-Signatures are just as legally binding A platform that is integrated with an e-Signature service can save the organization time and money allowing it to complete the contract cycle more expediently

Contract Compliance Increase alerts when documents are due (coming or past)

Organizations are at great risk when insurance certificates certifications releases or audits are not completed or submitted on time With a platform that tracks when documentary re-quirements are due the organization knows when to remind a supplier or take more severe action (such as halting all orders to the supplier until the issue is corrected) if the documen-tation needed is not received in a timely fashion

Usage Cost Decrease packaging improvements

In some industries such as food and beverage and pharmaceutical the packaging of a den-se liquid especially one with a tendency to stick to certain types of packaging can have a significant impact on the usage cost when there is high waste or expensive processes are needed to clean the containers for recycling Packaging improvements that use new types of non-stick packaging can reduce the overall lifecycle costs even if the packaging is more expensive

Risk Decrease in-transit visibility

A system that allows an organization to track its shipments from the time they leave the supplierrsquos warehouse to the time they hit the organizationrsquos warehouse with updates each time a waypoint is met or a (n intermodal) transfer is made with regular updates helps an organization not only track where itrsquos shipments are but whether or not they are likely to arrive at the expected time

Order-to-Pay Cost Decrease automatic payment on successful m-way match

Automated m-way match between a purchase order invoice and goods receipt not only increases efficiency but also increases effectiveness if the system can also automatically queue invoices that pass the m-way match for payment as this helps both Procurement and Accounts Payable be more effective in payment and cash flow planning

Efficient Procurement

As already mentioned efficiency can be invested into increasing effectiveness for example by enabling Procurement to address areas that have been left untouched or sub-optimized until now because of a lack of capacity In addition efficiency improvements allow Procurement to be more agile and pro-active

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

12

This leads to new capabilities and enhancements in cycle timesAnd allows for the following best practices to be employed which increase efficiency even more

Revisit sourcing lists (preferred suppliers) more than once a year to ensure continuous alignment between sourcing strategy and needs (especially critical for new product developments)

Manage market dynamics better the ability to identify and capture positive market changes (or mitigate impacts of negative ones) by dynamically going back to market

Improved cycle times in spend management processes that enable other support functions or positively impact the product lifecycle

Reduce savings leakage by transforming identified savings into actual savings realized because of improvements in contract management

Another aspect of efficiency lies in the tools used by Procurement to perform its activities Effi-ciency as stated earlier is about how Procurement works and in our technological era it is im-possible not to talk about technology Technology plays a key role in efficiency gains because it is an enabler simplifying a lot of administrative tasks and making process integration possible

Typical efficiency gains that are specific to using Procurement technology include

Automation impacting the level of resources needed and cycle times

Economies of scale from centralizing information and data management

Knowledge Management (KM) based on centralizing and securing information while making it more available across geographies (physical or functional)

Volatile markets opportunity or problem

The answer to this question depends on how you manage these challenges The fact

remains that Procurement must operate in the context of volatile markets

Therefore Procurement has to be equipped to cope with this

Part of this equipment is a mechanism to feed Sourcing events with real-time mar-

ket information This can be used among other things to track raw material prices

from external sources (eg London Metal Exchange) So when you have an RFQ in

addition to the suppliersrsquo conditions you can check the key price drivers against the

current market This is valuable information to ensure you do not ldquoleave moneyrdquo on

the table andor ask the right questions to suppliers to find ways to optimize condi-

tions for both parties

Plus having real-time market information allows you to constantly assess past agree-

ments against current conditions and if necessary go back to market easily

How Procurement responds to market changes is part of the broader idea of Procure-

ment agility that is a key differentiator in our world in constant change

For more see here

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

11

travel services etc) and this spend ends up being requisitioned through e-mail requests made then is not entered in the Procurement system until the invoice comes in But if the organization has an extensive catalog where arbitrary items can be created by the or-ganization as needed all requisitions approval and spend gets recorded and gets under management

Contract Cost Decrease e-Signature options

Some organizations pay a lot of money couriering contracts back and forth for signature even when e-Signatures are just as legally binding A platform that is integrated with an e-Signature service can save the organization time and money allowing it to complete the contract cycle more expediently

Contract Compliance Increase alerts when documents are due (coming or past)

Organizations are at great risk when insurance certificates certifications releases or audits are not completed or submitted on time With a platform that tracks when documentary re-quirements are due the organization knows when to remind a supplier or take more severe action (such as halting all orders to the supplier until the issue is corrected) if the documen-tation needed is not received in a timely fashion

Usage Cost Decrease packaging improvements

In some industries such as food and beverage and pharmaceutical the packaging of a den-se liquid especially one with a tendency to stick to certain types of packaging can have a significant impact on the usage cost when there is high waste or expensive processes are needed to clean the containers for recycling Packaging improvements that use new types of non-stick packaging can reduce the overall lifecycle costs even if the packaging is more expensive

Risk Decrease in-transit visibility

A system that allows an organization to track its shipments from the time they leave the supplierrsquos warehouse to the time they hit the organizationrsquos warehouse with updates each time a waypoint is met or a (n intermodal) transfer is made with regular updates helps an organization not only track where itrsquos shipments are but whether or not they are likely to arrive at the expected time

Order-to-Pay Cost Decrease automatic payment on successful m-way match

Automated m-way match between a purchase order invoice and goods receipt not only increases efficiency but also increases effectiveness if the system can also automatically queue invoices that pass the m-way match for payment as this helps both Procurement and Accounts Payable be more effective in payment and cash flow planning

Efficient Procurement

As already mentioned efficiency can be invested into increasing effectiveness for example by enabling Procurement to address areas that have been left untouched or sub-optimized until now because of a lack of capacity In addition efficiency improvements allow Procurement to be more agile and pro-active

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

12

This leads to new capabilities and enhancements in cycle timesAnd allows for the following best practices to be employed which increase efficiency even more

Revisit sourcing lists (preferred suppliers) more than once a year to ensure continuous alignment between sourcing strategy and needs (especially critical for new product developments)

Manage market dynamics better the ability to identify and capture positive market changes (or mitigate impacts of negative ones) by dynamically going back to market

Improved cycle times in spend management processes that enable other support functions or positively impact the product lifecycle

Reduce savings leakage by transforming identified savings into actual savings realized because of improvements in contract management

Another aspect of efficiency lies in the tools used by Procurement to perform its activities Effi-ciency as stated earlier is about how Procurement works and in our technological era it is im-possible not to talk about technology Technology plays a key role in efficiency gains because it is an enabler simplifying a lot of administrative tasks and making process integration possible

Typical efficiency gains that are specific to using Procurement technology include

Automation impacting the level of resources needed and cycle times

Economies of scale from centralizing information and data management

Knowledge Management (KM) based on centralizing and securing information while making it more available across geographies (physical or functional)

Volatile markets opportunity or problem

The answer to this question depends on how you manage these challenges The fact

remains that Procurement must operate in the context of volatile markets

Therefore Procurement has to be equipped to cope with this

Part of this equipment is a mechanism to feed Sourcing events with real-time mar-

ket information This can be used among other things to track raw material prices

from external sources (eg London Metal Exchange) So when you have an RFQ in

addition to the suppliersrsquo conditions you can check the key price drivers against the

current market This is valuable information to ensure you do not ldquoleave moneyrdquo on

the table andor ask the right questions to suppliers to find ways to optimize condi-

tions for both parties

Plus having real-time market information allows you to constantly assess past agree-

ments against current conditions and if necessary go back to market easily

How Procurement responds to market changes is part of the broader idea of Procure-

ment agility that is a key differentiator in our world in constant change

For more see here

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

12

This leads to new capabilities and enhancements in cycle timesAnd allows for the following best practices to be employed which increase efficiency even more

Revisit sourcing lists (preferred suppliers) more than once a year to ensure continuous alignment between sourcing strategy and needs (especially critical for new product developments)

Manage market dynamics better the ability to identify and capture positive market changes (or mitigate impacts of negative ones) by dynamically going back to market

Improved cycle times in spend management processes that enable other support functions or positively impact the product lifecycle

Reduce savings leakage by transforming identified savings into actual savings realized because of improvements in contract management

Another aspect of efficiency lies in the tools used by Procurement to perform its activities Effi-ciency as stated earlier is about how Procurement works and in our technological era it is im-possible not to talk about technology Technology plays a key role in efficiency gains because it is an enabler simplifying a lot of administrative tasks and making process integration possible

Typical efficiency gains that are specific to using Procurement technology include

Automation impacting the level of resources needed and cycle times

Economies of scale from centralizing information and data management

Knowledge Management (KM) based on centralizing and securing information while making it more available across geographies (physical or functional)

Volatile markets opportunity or problem

The answer to this question depends on how you manage these challenges The fact

remains that Procurement must operate in the context of volatile markets

Therefore Procurement has to be equipped to cope with this

Part of this equipment is a mechanism to feed Sourcing events with real-time mar-

ket information This can be used among other things to track raw material prices

from external sources (eg London Metal Exchange) So when you have an RFQ in

addition to the suppliersrsquo conditions you can check the key price drivers against the

current market This is valuable information to ensure you do not ldquoleave moneyrdquo on

the table andor ask the right questions to suppliers to find ways to optimize condi-

tions for both parties

Plus having real-time market information allows you to constantly assess past agree-

ments against current conditions and if necessary go back to market easily

How Procurement responds to market changes is part of the broader idea of Procure-

ment agility that is a key differentiator in our world in constant change

For more see here

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

13

In addition to increasing efficiency in your Procurement organization technology also enables suppliers to be more efficient This means that Procurement can introduce efficiencies into the supply chain that it can benefit from This is also an important aspect of the business case for better supplier onboarding (supplier portals EDI e-Invoicing etc)

But not all technologies are equal when looking at efficiencies Some technologies are more cost effective than others Remember what Rudzki Smock Katzorke and Stewart said in Stra-ight to the Bottom Line An Executive Roadmap to World Class Supply Management

Also cost includes IT costs (infrastructure licenses fees etc) and usability costs In recent years SaaS and cloud solutions have transformed many functions Procurement included because they often maximize time-to-value vs on-premises solutions

In addition to reducing installation and operating costs most SaaS and cloud solutions rely on the philosophy of interoperability

System-to-system (interfaces and communication protocols)

Process-to-process (interdependence and integration)

People-to-people (collaboration)

All of this is in the context of a global economy and global supply chains Concepts like Enter-prise 20 are the new norm

Thanks to SaaS and cloud technologies Procurement can create a workspace containing all the data required for both strategic and tactical activities This workspace is ERP-agnostic mea-ning that it can be connected easily to multiple and various systems (ERPs and beyond PLMs BWs etc) internal and external systems This

centralizes key information in a single location making data collection and analysis easier

fosters collaboration with various partners and stakeholders as required by the various busi-ness processes running in the solution

streamlines data management by having data directly managed by the relevant data owner

simplifies master data management (MDM) by creating one set of master data that then dispatches the information to the operational systems and

Dont jump whole hog into technology Walk and then run if it works Establish meaningful metrics to measure its performance Make sure each piece fits into a long-term puzzle

Robert A Rudkzi Douglas A Smock Michael Katzorke and Shelley Stewart Jr

raquo raquo

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

14

increases agility and resilience by securing data and making it easily transferable (imagine an organizational change that results in changes in responsibilities and the resulting nightmare of transferring the data contained in mailboxes)

On top of that and as highlighted by the concept of interoperability cloud solutions usually live in an app ecosystem The capacity to connect to third party solutions is integrated into the solutionrsquos design and architecture For example this allows Procurement to enrich internal

data coming from internal systems with third party content to get a bigger picture than what was previously available or at least get the information faster by having the right information pushed to the right place and at the right moment

Sustainable Procurement

As noted earlier this obviously comes from having a culture of continuous improvement (DMAIC) However this isnrsquot everything Decisions your Procurement organization make today will impact operations tomorrow Therefore looking at the impacts (or future consequences) of todayrsquos decisions is a critical component of the Procurement Value Engine

This is the capability to influence the future by

Defining it (ldquoIFrdquo) - predictive analytics

Preparing for it (ldquoTHEN THATrdquo) - risk management

All of this is about anticipating and avoiding negative situations andor maximizing the occur-rence of positive ones This is the whole purpose of the broader discipline of risk management

Other Stakholder

Procurement

Masterdata 1

Masterdata 2

Masterdata n

Suppliers

3rd Party Sources Internal Information SystemsAccess Control amp Roles

Business Process 1

Business Process 2

Business Process n

Increasing the Value-for-Money (VfM) of Procurement

We need more standardized readily available third-party information shared amongst networked communities where people can pool data for operational assessment

raquoraquo

Gerard Chick amp Robert Handfield

Boost Your Procurement Value Engine I wwwpool4toolcom

16

As illustrated in the quote on the previous page current technologies are characterized by being able to gather more data thereby enabling deeper and more meaningful analysis But data alone means nothing It is what you do with it that creates value

A typical example in Procurement can be found in sourcing decisions Awarding business to suppliers must take into account the risks that the decision represents For example low-cost country (LCC) sourcing has been high on the agenda of many Procurement organizations for a while Most have now learned their global sourcing lessons and are now looking beyond LCC as simply a ldquocost downrdquo opportunity but also a ldquorisk uprdquo challenge

Increasing the Value-for-Money (VfM) of Procurement

How much do supply chain disruptions cost

Extract from a white paper by Zurich Insurance Group

Extensive research looked at thousands of company results whereby comments in

SEC reports were tied back to the stock performance of these companies The study

shows an average 25 percent reduction in share price and an impact which com-

monly lasts over two years as a result of supply chain disruptions Companies can

be simultaneously impacted by decreased sales and brand damage while incurring

significant extra expenses during recovery times following a business interruption

Historically supply chain disruptions can lead to an average of 9 percent lower sa-

les and 11 percent higher costs and many companies with extended interruptions

never recover

Perf

orm

ance

Preparation

TimeDisruptive event

Time of impact

Recovery

First response 9-30

Shareholder impact

Initital impact

Preparation for recovery

long term impact

We need more standardized readily available third-party information shared amongst networked communities where people can pool data for operational assessment

raquoraquo

Gerard Chick amp Robert Handfield

Boost Your Procurement Value Engine I wwwpool4toolcom

16

As illustrated in the quote on the previous page current technologies are characterized by being able to gather more data thereby enabling deeper and more meaningful analysis But data alone means nothing It is what you do with it that creates value

A typical example in Procurement can be found in sourcing decisions Awarding business to suppliers must take into account the risks that the decision represents For example low-cost country (LCC) sourcing has been high on the agenda of many Procurement organizations for a while Most have now learned their global sourcing lessons and are now looking beyond LCC as simply a ldquocost downrdquo opportunity but also a ldquorisk uprdquo challenge

Increasing the Value-for-Money (VfM) of Procurement

How much do supply chain disruptions cost

Extract from a white paper by Zurich Insurance Group

Extensive research looked at thousands of company results whereby comments in

SEC reports were tied back to the stock performance of these companies The study

shows an average 25 percent reduction in share price and an impact which com-

monly lasts over two years as a result of supply chain disruptions Companies can

be simultaneously impacted by decreased sales and brand damage while incurring

significant extra expenses during recovery times following a business interruption

Historically supply chain disruptions can lead to an average of 9 percent lower sa-

les and 11 percent higher costs and many companies with extended interruptions

never recover

Perf

orm

ance

Preparation

TimeDisruptive event

Time of impact

Recovery

First response 9-30

Shareholder impact

Initital impact

Preparation for recovery

long term impact

Boost Your Procurement Value Engine I wwwpool4toolcom

16

As illustrated in the quote on the previous page current technologies are characterized by being able to gather more data thereby enabling deeper and more meaningful analysis But data alone means nothing It is what you do with it that creates value

A typical example in Procurement can be found in sourcing decisions Awarding business to suppliers must take into account the risks that the decision represents For example low-cost country (LCC) sourcing has been high on the agenda of many Procurement organizations for a while Most have now learned their global sourcing lessons and are now looking beyond LCC as simply a ldquocost downrdquo opportunity but also a ldquorisk uprdquo challenge

Increasing the Value-for-Money (VfM) of Procurement

How much do supply chain disruptions cost

Extract from a white paper by Zurich Insurance Group

Extensive research looked at thousands of company results whereby comments in

SEC reports were tied back to the stock performance of these companies The study

shows an average 25 percent reduction in share price and an impact which com-

monly lasts over two years as a result of supply chain disruptions Companies can

be simultaneously impacted by decreased sales and brand damage while incurring

significant extra expenses during recovery times following a business interruption

Historically supply chain disruptions can lead to an average of 9 percent lower sa-

les and 11 percent higher costs and many companies with extended interruptions

never recover

Perf

orm

ance

Preparation

TimeDisruptive event

Time of impact

Recovery

First response 9-30

Shareholder impact

Initital impact

Preparation for recovery

long term impact

Boost Your Procurement Value Engine I wwwpool4toolcom

17Increasing the Value-for-Money (VfM) of Procurement

Because supply chains are more and more global (ie complex) and regulations are constantly evolving the dimensions impacting sourcing decisions are becoming more and more complex Complexity includes process dependencies due to the DMAIC approach

and value analysis

Therefore having the big picture when analyzing bids and deciding an award is critical As exp-lained earlier this is where SaaS solutions and their app ecosystem can make life easier and re-present tremendous value in terms of time saved (data collection analysis) and value creation avoiding future issues is cost-avoidance that has value even if not measured in a PampL impact

The concept of ldquothe right information at the right time and the right placerdquo is illustrated below in the example of analyzing bids from suppliers In addition to the quotes a purchaser has all

Category Strategy

Company Strategy

Strategy per

Supplier

Risk amp Sus-tainabilityAnalysis

Supplier Integration

Supplier Controlling

Supplier De-velopment

Parameters for Sourcing amp

Award Decisions

From the TCO analysishellip hellip to the TVO analysis (Total Value of Ownership)

Supplier Selection

Supplier Selection

Supplier Connection

Supplier Controlling

Market Research

Category Strategy

eSourcing eSourcing

WebEDIEDI

Supplier Perf Rating

Supplier Profile

+ Supplierlsquos Production Costs

+ Supplierrsquos Production Costs

+ Evaluation of Results

+ Price Constraints + Price Constraints

+ Lead Buyer Stra-tegy

+ Supplierlsquos Material Costs

+ Supplierrsquos Material Costs

+ Process Costs given by the Supplier

+ Overhead + Overhead

+ Potential Evaluation

= TCO = TVO

Boost Your Procurement Value Engine I wwwpool4toolcom

18

Procurementrsquos role sitting between the enterprise and

supply markets means it will always be exposed to various factors outside the enterprise probably more so than any other function If itrsquos not commodity prices fluctuating crazily or natural disasters threatening supply continuity it will be something else like unethical practices in the supply pipeline giving the enterprise bad press

The Procurement leader must steer the team through the choppy waters of such challenges

raquoraquo

Sigi Osagie

Boost Your Procurement Value Engine I wwwpool4toolcom

19

TCO TVO information via various scores (bonus penalty) based on the key dimensions of the category

Moreover technology does not just limit itself to the passive role of making information availa-ble Technology can be proactive

The terms Big Data and Internet of Things are frequently used as buzzwords but they also illustrate the increased capabilities that new technologies enable in collecting and presenting data As always the real value is not in the data itself but in the actionable intelligence that you build and the actions decisions you take

Therefore algorithms will make the key difference and give companies a competitive advantage For Procurement this means technologies with capabilities

to allow an organization to act (or at least to propose a possible set of actions) based on data analyzed in real time and

to create new knowledge by identifying trends or correlations that have not been seen until now

will provide the sustainable value that Procurement is looking for

Our next paper will dive deeper into what these technologies are what they do and the many ways they enable efficiency and effectiveness but for now we will conclude that for a Procure-ment organization to have a sustainable Value Engine function Procurement will have to build and develop the right capabilities (people process and technology)

Supplier quote

TCOTVO (internal) based on various dimensions (risk

CSRhellip)

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

19

TCO TVO information via various scores (bonus penalty) based on the key dimensions of the category

Moreover technology does not just limit itself to the passive role of making information availa-ble Technology can be proactive

The terms Big Data and Internet of Things are frequently used as buzzwords but they also illustrate the increased capabilities that new technologies enable in collecting and presenting data As always the real value is not in the data itself but in the actionable intelligence that you build and the actions decisions you take

Therefore algorithms will make the key difference and give companies a competitive advantage For Procurement this means technologies with capabilities

to allow an organization to act (or at least to propose a possible set of actions) based on data analyzed in real time and

to create new knowledge by identifying trends or correlations that have not been seen until now

will provide the sustainable value that Procurement is looking for

Our next paper will dive deeper into what these technologies are what they do and the many ways they enable efficiency and effectiveness but for now we will conclude that for a Procure-ment organization to have a sustainable Value Engine function Procurement will have to build and develop the right capabilities (people process and technology)

Supplier quote

TCOTVO (internal) based on various dimensions (risk

CSRhellip)

Increasing the Value-for-Money (VfM) of Procurement

Boost Your Procurement Value Engine I wwwpool4toolcom

20

copy Copyright POOL4TOOL AG Altmannsdorfer Straszlige 9119

1120 Vienna | Austria Phone +43-1-80 490 80

Editor Bertrand Maltaverne Senior Project Manager

POOL4TOOL AG

Michael Lamoureux Sourcing Innovation

More information officepool4toolcom

wwwpool4toolcom

POOL4TOOL AGAltmannsdorfer Straszlige 9119 A-1120 Vienna Tel+43-1-80 490 80

officepool4toolcomwwwpool4toolcom

Vienna I Stuttgart I Munich I Belgrade I Detroit I Singapore I Dubai