The small and large-sized purchasing department plays an important role and a huge responsibility as well in business of any company. The department takes assignment in finding goods or services at the best price in accordance with quantity and quality required. Taking the key performance indicators into purchase the company can appreciate purchasing habits and point out performance of superior or inferior vendors.
Managers from purchasing departments often give prominence to considering purchasing performance indicators as a way of demonstrating the strategic value as well as key role of the purchasing function to top management. However, there are a couple of unavoidable mistakes in measuring and reporting purchasing performance that make opposite effect.
I. KPI examples of Purchasing dept
II. Steps to create KPIs of Purchasing dept
• Setting up job purpose of Purchasing department.
• Setting up key responsibilities/key KRAs of this department.
• Setting up elements that how to measure each KRA.
• Setting up KPI of each KRA.
• Summarize all KPIs of each department.
III. KPIs of each position of Purchasing field
• Purchasing director.
• Purchasing manager.
• Purchasing assistant.
• Purchasing supervisor.
• Purchasing specialist.
• Purchasing coordinator.
• Purchasing clerk.