Change with Impact

Procurement key performance indicators

Defining effective KPIs in procurement

You need specific key performance indicators (KPIs) to measure the effect of procurement activities. The challenge is to define the right ones.

Procurement key performance indicators

The 19th century physicist Lord Kelvin declared: ʻIf you cannot measure it, you cannot improve itʼ. Applying this famous statement to management, management thinker Peter Drucker says that ʻyou cannot manage what you cannot measureʼ. In other words, you need a clearly defined yardstick for measuring effect or documenting success.

That is what KPIs can help you do. However, if you want a correct indication of progress, it is important that the KPIs you are using are the right ones.

In procurement, some of the important KPIs are savings and cost avoidance, but there might be other indicators you wish to include to measure behaviour or business impact. At Implement Consulting Group, our teams of experts can help identify the KPIs that are right for measuring operations in your business.

How can you reduce indirect spend? Watch the video below.

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