Key Performance Indicators (Kpis)
In order to measure and manage the performance of a procurement function, Key Performance Indicators (KPIs) are used. KPIs cover a broad range of activities within procurement, such as spend under management, supplier performance, contract compliance, and quality of products or services procured.
There is no one-size-fits-all definition of KPIs for procurement, as the appropriate indicators will vary depending on the organization’s specific goals and objectives. However, some commonly used KPIs in procurement include:
Spend under management: The total amount of money spent by an organization on goods and services that are subject to procurement processes and procedures.
Supplier performance: A measure of how well suppliers meet the quality, delivery, and cost requirements set by the organization.
Contract compliance: The degree to which suppliers adhere to the terms and conditions of their contracts with the organization.
Quality of products/services procured: A measure of the overall satisfaction with the goods and services procured by the organization.