In the wake of the Great Recession, and in the midst of the slow recovery, companies continue to turn to their procurement function as a source for additional savings. Yet for a variety of reasons – overestimating, dubious budgeting, poor demand management and compliance, and changes in baseline assumptions – the identified savings are never actually captured and reflected on the bottom line. To get the most from procurement savings initiatives, organizations need to have in place six elements. Three of these elements – initiative definition, strong-form budgeting, and well-defined measurement and tracking – are tactical, business process challenges. The other three – senior management commitment, cross-functional engagement, and the brokering process – are softer issues, but they are no less critical to maximizing savings and making changes stick.

Contributors: PwC
Categories: Tool
SRC Type: Realization, Sourcing