Procurement Manager Interview Question:

Do you know which are the key procurement metrics?

Submitted by: Muhammad

Every organization has different goals and different situations. Therefore, the optimal procurement metrics for one organization may not be the optimal procurement metrics for another organization. That being said, there are 10 Procurement Key Performance Indicators that all procurement departments should consider including in their metrics. Of course, some of these may not apply and others that are not mention should be included. Therefore, please consider these metrics more of a starting point for ideas than a standard set of metrics:

☛ Cost savings
☛ Managed spend as a percentage of total spend
☛ Cost savings as a percentage of managed spend
☛ Procurement operating costs as a percentage of managed spend
☛ Return on investment
☛ Percent of on-time supplier deliveries
☛ Supplier defect rate
☛ Customer satisfaction
☛ Procurement cycle time
☛ Value of supplier idea implementation
Submitted by: Muhammad