Manage my business Procurement Dashboard

Manage my business | Procurement Dashboard

Procurement Dashboard: Minimize your Supplier Risks by Pinpointing single-supplier dependencies. Identify Savings Opportunities by Finding supplier rationalization opportunities. Gain full spend Visibility by Analyzing expenses across silos

CONTEXT & CHALLENGES

You wish to…
Get more Value? Reduce Costs? Minimize Risks? Save Time? Improve Quality?

The role of the purchasing manager involves far more than simply managing procurement of the company’s supplies. Purchasing supplies is of course the responsibility of the purchasing manager, but this function requires very focused and comprehensive management of the entire supply chain, from beginning to end. He or she must optimize supplies, and not only in terms of price negotiations. Supplier relationships must be built with a long-term view.

Improvement of deliverables, ensuring compliance with the requirements of all stakeholders, exhaustive knowledge of the economic context, full control of internal logistics, cross-cutting analysis of the needs of various departments, ability to centralize information so that it can be redistributed more effectively and fully meet requirements and deadlines, an overview of the management of flows and stocks, quality control and safety management…

… all of these tasks place the purchasing manager at the center of the company’s operations. At all levels, the optimization of purchasing increases margins and, therefore, profitability, without compromising on the quality of products, as well as internal and external relationships.

This is why it is essential to continuously monitor procurement activities, while systematically assessing and challenging across four areas:

  • Costs
  • Delay
  • Quality
  • Contractual Conditions

PROCUREMENT GOALS AND OBJECTIVES

Procurement Strategy Optimization

  • Rationalize procurement & suppliers
  • Increase spend under management
  • Define efficient sourcing strategy
  • Gain full spend visibility

Supplier Management

  • Select & qualify suppliers
  • Reduce supplier risks
  • Reduce maverick spending and contract leakage

Demand Management

  • Identify savings opportunities
  • Centralize demands

Offer Management

  • Involve innovative players
  • Leverage competition

Contract Management

  • Secure contracts
  • Negotiate the best conditions
  • Create innovative pricing model

Delivery Management

  • Ensure service level continuity
  • Ensure respect of engagements and non-deviation

SOLUTIONS

In order to optimize costs, anticipate the needs of each division within your organization and save valuable time, it is essential to be able to monitor the entire purchasing area in real-time. Your purchasing dashboard will give you a global vision of your purchasing activities and, above all, will enable you to take immediate and effective actions for your organization:

Gain full spend visibility

By analyzing expenses across silos

Minimize your supplier risks

By pinpointing single-supplier dependencies

Systematically identify costs-savings opportunities across divisions

By finding supplier rationalization opportunities

Increase spend under management

By centralizing spend information

Reduce unexpected expenditure

By identifying leakage areas

Determine vendor risks

By insulating the business from supplier disruptions

Rationalize suppliers

By developing efficient procurement strategy

PROCUREMENT KPIS

Key Performance Indicators are used to measure the realized progress towards a strategic objective.
For a Procurement dashboard, here is a sample list of KPIs Lintao recommends (non exhaustive list):

  • Procurement Cycle Time

  • Managed vs Total Spend

  • Saving (€)

  • DPO (Purchasing Volume)

  • PVO (Procurement Volume)

  • MCV (Material Cost Variance)

  • PVO per vendor

  • PVO per purchaser

  • Discount Actual

  • Discount %

  • Discount Projection

  • Discount Utilization (%)

  • DPO (Days Payable Outstanding)

  • Number of vendors

  • Average buying price

  • Average buying volume

  • Tax

  • Number of purchase orders

  • % cancelled and suspended contract

  • % of internal logistic cost

  • Inventory Turnover

  • % Late Delivery

  • Errors per Purchase Order

  • % Contracts delivered within original budget

  • % retention of active contracts

  • Delivery Delay / % Late

  • ... or you own Procurement KPI's

PROCUREMENT ANALYTICAL AXES

The axes of analysis represent the elements by which you want to segment your observable information (such a KPIs) to understand the rationales behind a given performance. Also called ‘dimensions’.
For a Procurement dashboard, Lintao identifies the following axes of analysis (non exhaustive list):

  • Time

  • Organization

  • Goods / Service

  • Purchasing Category

  • Purchaser

  • Vendor

  • Vendor Segment

  • ... or your own Procurement analysis axes

AN EXAMPLE OF A KEY DATA VISUALIZATION FOR PROCUREMENT

How to get an actionable dashboard in Procurement?

Imagine you get in one report showing you the list of all your suppliers. For each of them, you can visualize the growth of turnover you gave them versus last year. Now compare it, within the same visualization with the growth of Unit Price during the same period.

You are now able to call the suppliers which did not align their unit prices on the new volume you have offered to them… and get a well-deserved discount.

Procurement Dashboard

 

Visit our gallery for additional data visualization best-practices on Procurement.

GET AN IMPACTFUL PROCUREMENT DASHBOARD ON YOUR BI TECHNOLOGY

Tableau Software

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Some references of Procurement Dashboards