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Spending Analysis
Spend analysis or spend analytics is the process of collecting, cleansing, classifying and analyzing expenditure data with the purpose of decreasing procurement costs, improving efficiency, and monitoring controls and compliance. It can also be leveraged in other areas of business such as inventory management, contract management, complex sourcing, supplier management, budgeting, planning, and product development. Overview Spend analysis is often viewed as part of a larger domain known as spend management which incorporates spend analysis, commodity management, industry spend benchmarking, and strategic sourcing. Companies perform a spend analysis for several reasons. The core business driver for most organizations is profitability. In addition to improving compliance and reducing cycle times, performing detailed spend analysis helps companies find new areas of savings that previously went untapped, and hold on to past areas of savings that they have already negotiated. There ar ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Commodity Management
Commodity management is the process of developing a systematic approach to the entire usage cycle for a group of items. The term is often used interchangeably with category management. It is generally considered as one aspect of the procurement management toolkit, and frequently used in combination with other tools – such as 'two-by-four-box' analysis, looking at the strategic positioning of that commodity with respect to an organisation and its supplier. This may then be further developed with supplier relationship management (SRM), with designated buyers managing key suppliers in given commodities. See also Commodity management is also used in other contexts, as such managing dwindling availability of scarce resources. For this context, please see: * Resource management In organizational studies, resource management is the efficient and effective development of an organization's resources when they are needed. Such resources may include the financial resources, inventory, ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Benchmarking
Benchmarking is the practice of comparing business processes and performance metrics to industry bests and best practices from other companies. Dimensions typically measured are quality, time and cost. Benchmarking is used to measure performance using a specific indicator (cost per unit of measure, productivity per unit of measure, cycle time of x per unit of measure or defects per unit of measure) resulting in a metric of performance that is then compared to others. Also referred to as "best practice benchmarking" or "process benchmarking", this process is used in management in which organizations evaluate various aspects of their processes in relation to best-practice companies' processes, usually within a peer group defined for the purposes of comparison. This then allows organizations to develop plans on how to make improvements or adapt specific best practices, usually with the aim of increasing some aspect of performance. Benchmarking may be a one-off event, but is often ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Strategic Sourcing
Strategic sourcing is the process of developing channels of supply at the lowest total cost, not just the lowest purchase price. It expands upon traditional organisational purchasing activities to embrace all activities within the procurement cycle, from specification to receipt, payment for goods and services to sourcing production lines where the labor market would increase firms' ROI. Strategic sourcing processes aim for continuous improvement and re-evaluation of the purchasing activities of an organisation. In the services industry, strategic sourcing refers to a service solution, sometimes called a strategic partnership, which is specifically customized to meet the client's individual needs. In a production environment, it is often considered one component of supply chain management. Modern supply chain management professionals have placed emphasis on defining the distinct differences between strategic sourcing and procurement. Procurement operations support tactical day-to- ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Chief Procurement Officer
A chief procurement officer (CPO) undertakes an executive role within an enterprise, focusing on sourcing, procurement, and supply management. Typically, a CPO is responsible for the management, administration, and supervision of the company's acquisition programs. They may be in charge of the contracting services and may manage the purchase of supplies, equipment, and materials. It is often his or her responsibility to source goods and services and to negotiate prices and contracts. Many CPOs report to a director or directly to the chief executive officer (CEO) of their company. Focus of interest A chief procurement officer and his or her department will often be responsible for: *ensuring that goods and services are promptly delivered *making sure that vendors are paid in a timely manner *supplier relationship management. Some CPOs are in charge of locating sources for supplies and services, and of maintaining relations with suppliers and vendors. They usually negotiate with ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Cost Centre (business)
A cost centre is a department within a business to which costs can be allocated. The term includes departments which do not produce directly but incur costs to the business, when the manager and employees of the cost centre are not accountable for the profitability and investment decisions of the business but they are responsible for some of its costs. Types There are two main types of cost centres: * Production cost centres, where the products are manufactured or processed. Example of this is an assembly area. * Service cost centres, where services are provided to other cost centres. Example of this is the personnel department or the canteen. Examples * Marketing department * Human resources * Research and development * Work office * Quality assurance * Engineering * Logistics * Procurement Cost centres can be trimmed down to the smallest segregated tasks within Departments. It is not necessary to consider departments as outright cost centres. Some companies adopt a different ap ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Commodity
In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them. The price of a commodity good is typically determined as a function of its market as a whole: well-established physical commodities have actively traded spot and derivative markets. The wide availability of commodities typically leads to smaller profit margins and diminishes the importance of factors (such as brand name) other than price. Most commodities are raw materials, basic resources, agricultural, or mining products, such as iron ore, sugar, or grains like rice and wheat. Commodities can also be mass-produced unspecialized products such as chemical substance, chemicals and computer memory. Popular commodities include Petroleum, crude oil, Maize, corn, and gold. Other definitions of commodity include something useful or valued and an alternative ter ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Procurement
Procurement is the method of discovering and agreeing to terms and purchasing goods, Service (economics), services, or other works from an external source, often with the use of a tendering or competitive bidding process. When a government agency buys goods or services through this practice, it is referred to as Government procurement, public procurement. Procurement as an organization, organizational process is intended to ensure that the buyer receives goods, services, or works at the best possible price when aspects such as quality, quantity, time, and location are compared. Corporations and public bodies often define processes intended to promote fair and open competition for their business while minimizing risks such as exposure to fraud and collusion. Almost all purchasing decisions include factors such as delivery and handling, marginal benefit, and fluctuations in the prices of goods. Organisations which have adopted a corporate social responsibility perspective are also ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
