In our previous blog we explored the scenarios mandating a new approach for procurement and the need to track and measure procurement performance. We mentioned measures that can be adopted by organizations to improve their savings tracking process.
Let us now focus on how organizations can streamline the process of mapping procurement performance by leveraging technology. The process can be spread across 3 steps; the 1st step being discussed today.
The first step in the process is – CONFIGURATION.
This is the basic step which defines the structure and boundary of the project. It can be further narrowed down to the following pointers;
- Project type
Freeze on the type of the project for instance, cost avoidance, cost reduction etc. and benefits expected out of the project.
Customize the fields and the savings formula used to assess performance in the procurement measurement system, as per the requirements of the project. For instance, track savings as per different business units, functions, plants etc.
- Defining user roles
Ensure not everyone has access to the project data and that only right people have the right access by defining access rights or levels for the users.
- Customized approval workflow
In order to have data that is relevant and accurate, approval workflows should be defined to ensure information passes through the correct channel.
- Project stages
There are multiple stages that a project passes through. It is necessary to ensure that at every stage an organization is able to match the realized savings with forecasted savings.
- Configure savings target
An ability to set savings target for teams/individuals which ensures the resources are planned well.
In the next blog we will discuss step 2 and step 3 for mapping procurement performance.