KPI Examples
KPI Scorecard provides you insight into your supplier management program and helps you manage the cost compliance process.
Here are just a few examples of what KPI can do for you:
1. Purchasing/Procurement Tracking
- Price to Price
- Obtaining the same product at a better price. This usually occurs through multi-party negotiations.
- Rebate programs
- Incentives offered by suppliers when additional volume is achieved. This can occur by creating single-source contracts or giving suppliers opportunities to provide additional products or services.
2. Asset Utilization Tracking
- PFEP - Plan For Every Part
- An integral part of inventory control plans that helps eliminate waste and obsolescence. PFEP is a core part of creating lean material management (six sigma) initiatives.
- Enterprise Component Sharing (ECS)
- Providing visibility and access to critical spare/OEM components within the enterprise. This reduces the number of critical spares maintained in inventory.
3. Warranty and Repair Savings Tracking
- Warranty recovery
- Tracking and utilizing the warranty provided by the OEM and the vendor of record. This reduces repair and/or replacement costs.
4. Process Savings
- Reduction or reallocation of labor (FTE)
- Any process improvement that can reduce headcount.
- Product standardization
- Reducing the number of products used by the client. This aggregates purchasing leverage, creates simplicity and reduces waste.
5. Inventory Reduction
- Identification of excess and obsolete (E&O)
- Every business has excess and obsolete material. Identifying E&O and creating a disposition plan can generate much needed cash, free up valuable production space and create better process efficiencies.
6. Environment/Green Initiatives
- Carbon Offsets
- Tracking various types of carbon offsetting in voluntary carbon offset programs.
7. MBE / Diversity Spend Tracking
- Promoting minority, WBE and disadvantaged businesses
- Tracking minority and diversity spend throughout the supply chain. This can include tier 1 and tier 2 credits (i.e. minority/diversity support occurring with a client's suppliers trading partners).
Are you ready to improve your
supplier performance management program?
In today's competitive environment and demanding economy, you need to find a way to squeeze everything you can out of your supply chain management process. It's a significant challenge and you know it, but you also know that running the best possible procurement program is a key factor in your company's success. And the people around you have a lot of questions about making the most of your supplier management effort.
The KPI Scorecard is a powerful supply chain management tool that delivers - one that will work to your bottom line quickly and help you meet the demands that the economic environment and your competitors inevitably put on you.
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