Purchasing Measurement: Provide Examples Of Performance

Purchasing measurement
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Purchasing Measurement
The management of any organization play the key role in determining how results in purchasing can be measured. The management’s perception of the role of the purchasing department must be guided by the function that it performs (Ginsberg & Sheridan, 2001). In most cases it evaluates the department by number of orders being issued, procedure adherence, order backlog and the lead-time in administration. Secondly, the purchasing department is also evaluated in terms of the total savings that the department reports, report variance and the inflation period. However the importance of the old adage, “you can’t manage what you can’t measure” can be seen in the activities of the department as discussed above. The department will enable the company to save a great deal since it keeps log of all the costs incurred during purchases and is better placed to reduce the cost during lean economic times. With purchasing meas...