Procurement Benchmarking Definition

The term “procurement benchmarking” is often used interchangeably with “supplier performance measurement” or “supplier performance management.” However, procurement benchmarking goes beyond simply measuring supplier performance. It also encompasses the process of identifying opportunities for improvement and developing action plans to address those areas.

In order to be effective, procurement benchmarking must be tailored to the specific needs of the organization. It should take into account the organization’s size, industry, culture, and objectives. Additionally, procurement benchmarking should be a continuous process, not a one-time event.

There are four steps in the procurement benchmarking process:

1) Identification of areas for improvement: This step involves conducting a comprehensive review of the organization’s procurements processes and systems. It also includes identifying best practices within the industry and assessing how the organization stacks up against those standards.

2) Development of action plans: Once areas for improvement have been identified, it is important to develop action plans to address those issues. The action plans should be specific, measurable, achievable, relevant, and time-bound (SMART).

3) Implementation of action plans: The third step is to put the action plans into effect. This may involve changes to processes or systems, training of employees, or other steps.

4) Evaluation and adjustment: The final step is to evaluate the results of the implementation and make adjustments as necessary