How to track, demonstrate and maximise added value
Any added value achieved in a procurement process can only be properly quantified, benchmarked and reported on, relative to previous or parallel examples. Ideally you’ll have a central repository of all your current and historical contract information, along with end-to-end management functionality that permits the continuous recording, extraction, and comparison of value-specific information. This enables reporting on added value at the conclusion of each procurement process and at intervals during the contract lifecycle.
Implementing a standard set of reporting metrics that take account of differing priorities across product and service areas – and factors such as inflation when conducting retrospective comparisons – allows you to signpost the specific types of added value that are most beneficial to the organisation in the long term and gives stakeholders and decision makers an insight into what can, and should, be achieved.
Crucially, added value should be prioritised in post-award contract
and supplier management
and engagement activities, with regular appraisals and reports on whether or not benefits have been delivered and if any new possibilities have presented themselves. Waste can end up eradicating any savings that have been secured, so placing an emphasis on added value within more general efforts to minimise spend leakage can contribute to maximising additional benefits and overall efficiency in the long term.
Drive maximum value from every supplier contract with Proactis Contract Management