Procurement Value Levers

Procurement value levers are those elements of the procurement process that have the potential to create value for an organization. Typically, these levers are related to cost, quality, delivery, and risk. Organizations can use these levers to improve their overall performance and competitiveness.

Cost: One of the most important procurement value levers is cost. Organizations can use cost-cutting strategies to improve their bottom line. For example, they can negotiate better prices with suppliers, streamline their purchasing processes, or implement spend analysis tools to identify areas where they can save money.

Quality: Another important value lever is quality. Organizations can use quality control measures to ensure that they are receiving products and services that meet their standards. They can also work with suppliers to improve the quality of their products and services.

Delivery: Delivery is another key element of procurement. Organizations need to ensure that they are receiving their products and services on time and in a manner that meets their needs. They can do this by working with suppliers who have a good track record of delivery, setting clear expectations for delivery times, and monitoring supplier performance closely.

Risk: Risk management is another important aspect of procurement. Organizations need to identify and manage risks associated with their procurements, such as supplier default or product defects. They can do this by conducting risk assessments, developing contingency plans, and maintaining insurance coverage.