“You can’t improve what you don’t measure” – Peter Drucker
In a time of constricted budgets, reduced resources, and prioritized emergency spending, it’s important that your procurement team is performing to the best of their abilities. However, it’s hard to know how your team can improve if you aren’t monitoring the data and trends of your department and individual contributors.
To uncover the procurement KPIs that will improve your team’s performance, ask yourself: Which of your departments has the longest average time-to-award? Which buyer has the lowest supplier engagement? Which projects saw the greatest savings compared to last year? If you don’t know the answers to these types of questions, don’t worry, you’re not alone. That’s why we’ve narrowed down the top procurement KPIs that will empower your team to improve—and how Euna Procurement can help.
Procurement KPI #1: Project Components
Project components—such as the requested information, criteria weighting, or the number of evaluators and suppliers involved in each project—are vital components of RFx events. These project components will often vary depending on the project type (ITB, RFQ, RFP, etc.) and therefore are delineated as such. With insights from Euna Procurement, you can determine if your results are aligned with your goals—or if there are problem areas that need addressing.
Beyond analyzing the trends of your internal projects, you can take your analysis a step further by comparing your typical project setup against our database of procurement events through our benchmarking feature. Benchmarking allows you to see how your peers in procurement have set up similar projects for the same category, including data on project timelines, criteria weighting, supplier engagement, and requested information, as well as view RFx documents of comparable opportunities.
When it comes to selecting your project components, decisions made early-on can have long-lasting impacts throughout the lifecycle of the project. For example, while criteria weighting plays a significant role in which supplier will be selected, we also know that it can be a deciding factor on whether suppliers decide to submit or not. Therefore, it’s important to make these decisions (the “who, what, and why” of your project) with confidence and conviction.
Procurement KPI #2: Timelines
Project timelines can be a critical indicator of how efficient your team is performing. When deadlines are tight, and end-users request goods and services to be delivered as soon as possible, time-to-value is imperative.
To optimize your timeline, it’s important to investigate the details. For example:
- Which stages of your projects are taking up the most time?
- Are your price-only bids being awarded quickly?
- Which buyers are most efficient with their timelines?
- Are your projects open for the appropriate length?
Each of these questions provide an opportunity for your team to improve.
To ensure your timeline goals are consistently met, the planning phase becomes crucial. Utilizing intake software allows you to monitor projects from the initial request, and integrate strategic planning during the initial phases of each project — ensuring that bids and RFPs are set-up for success.
Procurement KPI #3: Spend and Savings
Project Spend and Project Savings are potentially the two most important metrics you’ll be reporting on as a team. While procurement teams are often viewed as the ones who spend the money, public agencies are increasingly discovering procurement’s potential as a resource to save money as well.
By leveraging cost management with Euna Procurement, you’re able to track your current spend, target spend, projected budget, and percent savings. These metrics can be reported and visualized for each individual project, or by project type, buyer, and department.
Procurement KPI #4: Sustainability
Does your organization value environmental initiatives? Procurement workflows that rely on physical documents and scorecards can lead to a lot of paper waste. By digitizing your processes through a sourcing solution, you can positively contribute to your organization’s sustainability mandate. Euna Procurement even tracks the number of printed pages your department has saved over time. For example, Ventura County has eliminated 170,000 pages of paper since implementing Euna Procurement, saving them significant storage, filing, and paper shredding costs.
Ready to start tracking the procurement KPIs that will take your team’s performance to the next level? Request a demo of Euna Procurement today!
