How we optimise the measurability of procurement performance within the scope of procurement and overlapping strategies.

Background

Increasing competitive and price pressure, as well as the ever increasing complexity in procurement, require a new train of thought. Purchasing is morphing from a vicarious agent into the value driver of the organisation. These days, successful operation on global and national markets essentially requires the exploitation of synergy potentials and scale effects in procurement. The realignment of procurement strategies to intense target systems (costs, quality, flexibility and innovation), as well as their continuous adjustment to ever changing external and internal influencing factors are therefore success factors more relevant than ever before.

The specific task

  • To establish a procurement target system
  • To define feasible procurement strategies
  • To identify synergy potentials
  • To exploit scale effects

KBC Solution approach

In cooperation with our clients, we identified significant weaknesses in the previous procurement strategy and established improvement potentials together with our clients. We were able to define relevant interface sections and stakeholders at an early stage and involve them in the strategy development process. With this “ground truth” approach, we specifically incorporated the expertise of professional buyers in the strategy process and integrated development issues into strategy development to the same extent as the requirements of the quality department. We ultimately standardised the strategy development process in procurement for all of the product portfolio’s 216 trade groups.

Realisation of potential

The KBC Procurement Strategy System (PSS) formed the basis for the development of more than 200 individual procurement strategies, more than 1,000 employees and more than 30 bn Euros of procurement volume. The modular approach of the analytical methods provided our clients with a strategy process and a strategy system adaptable to all requirements. Professional buyers turned into strategists and the resulting procurement strategies were fully accepted, even in the implementation of strategic measures at operational level.

We were able to help our client not only in the development of a theoretical concept but also in its implementation. The KBC PSS approach has already helped numerous clients in ensuring a standardised development and central control of procurement strategies, as well as their efficient management.