CIPS encourages procurement organisations to assess their performance

12 May 2016

Top performing procurement departments deliver 10 to 15 times their costs and generate about $1.25m annually in financial benefits per procurement employee.

These were the top findings of last year’s CIPS and AT Kearney Return on Supply Management Assets (ROSMA) Performance Check Study, which is now available for procurement professionals to complete.

Last year’s report found “stellar” examples of procurement organisations setting a strong standard for performance excellence.

But overall it found inconsistent performance in the profession across key value drivers like spend coverage, sourcing programme velocity, sourcing project yields and outcomes, compliance rates and operating costs – regardless of company size, industry or spend mix.

CIPS encouraged supply management organisations to take the latest assessment themselves to see how they compare on these key drivers, either at enterprise level or within business units and divisions.

Completing the check, which is available here, takes approximately 30 to 45 minutes and information provided is confidential.

Upon completion, participants receive their organisation’s complementary ROSMA score and a customised feedback report that assesses their procurement performance, compares it to leaders and followers, and helps identify improvement opportunities.

A 2015 CIPS report, Building a Bolder Legacy: The Procurement Mission is Under Way, found that organisations in the bottom quarter returned less than 1.5 times their cost in value, with many unable to cover the cost of their organisational activities.

This was the viewpoint of 50% of 226 senior financial executives from Australia, France, Germany, the States and the UK who were surveyed.

David Noble, global CEO of CIPS, said: “Once again the results of the report show that procurement and supply management has a critical role to play in business success, and together the profession can advance in the pursuit of a stronger legacy for the years ahead.”

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