Purchasing Best Practices Definitions<\/h1><\/div><\/div><\/div>What Are They Talking About?<\/h2><\/div><\/div><\/div>Many organizations are paying hundreds of thousands of dollars to consultants to implement purchasing best practices. These consultants impress executives with their knowledge of the purchasing profession and their use of terms such as “commodity teams,” “process mapping,” and “total cost of ownership.” Many of these terms are simple names for principles that we apply daily. Here are a few terms and their definitions:<\/p>\n
Benchmarking:<\/b> The comparison of one organization’s purchasing performance indicators or processes with those of other purchasing departments or external sources.<\/p>\n
Buying Plan:<\/b> A document prepared annually that summarizes the purchasing department’s approach to acquiring each major group of products and services. The buying plan usually includes a forecast of demand, an estimate of spending, and the actions taken by the purchasing department to prudently manage the purchase of each group of products and services.<\/p>\n
Commodity Team:<\/b> A group of individuals representing various departments who are responsible for making key decisions relative to the purchase of a product or service.<\/p>\n
Process Mapping:<\/b> The act of creating a diagram that illustrates all tasks and decisions associated with a process.<\/p>\n
Stakeholders:<\/b> Individuals within an organization who have a vested interest in a specific product or service to be acquired.<\/p>\n
Strategic Plan:<\/b> A document that outlines a long-range approach to purchasing and is closely associated with organizational strategy.<\/p>\n
Total Cost of Ownership:<\/b> An estimate of all costs associated with the acquisition, use, and disposal of a product or service.<\/p>\n<\/div><\/div><\/div><\/div><\/div>Do You Want a More Rewarding Procurement Career?<\/h5><\/div>![](\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/12\/spsm_verify.jpg\" "\\"spsm_verify\\"")
<\/span><\/div>Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n
Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div>
Download<\/span><\/a><\/div><\/div><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div>![](\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/12\/services.jpg\" "\\"services\\"")
<\/span><\/div>Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n
You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n
Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>
What Are They Talking About?<\/h2><\/div><\/div><\/div>Many organizations are paying hundreds of thousands of dollars to consultants to implement purchasing best practices. These consultants impress executives with their knowledge of the purchasing profession and their use of terms such as “commodity teams,” “process mapping,” and “total cost of ownership.” Many of these terms are simple names for principles that we apply daily. Here are a few terms and their definitions:<\/p>\n
Benchmarking:<\/b> The comparison of one organization’s purchasing performance indicators or processes with those of other purchasing departments or external sources.<\/p>\n
Buying Plan:<\/b> A document prepared annually that summarizes the purchasing department’s approach to acquiring each major group of products and services. The buying plan usually includes a forecast of demand, an estimate of spending, and the actions taken by the purchasing department to prudently manage the purchase of each group of products and services.<\/p>\n
Commodity Team:<\/b> A group of individuals representing various departments who are responsible for making key decisions relative to the purchase of a product or service.<\/p>\n
Process Mapping:<\/b> The act of creating a diagram that illustrates all tasks and decisions associated with a process.<\/p>\n
Stakeholders:<\/b> Individuals within an organization who have a vested interest in a specific product or service to be acquired.<\/p>\n
Strategic Plan:<\/b> A document that outlines a long-range approach to purchasing and is closely associated with organizational strategy.<\/p>\n
Total Cost of Ownership:<\/b> An estimate of all costs associated with the acquisition, use, and disposal of a product or service.<\/p>\n<\/div><\/div><\/div><\/div><\/div>Do You Want a More Rewarding Procurement Career?<\/h5><\/div><\/span><\/div>Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n
Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div>
Download<\/span><\/a><\/div><\/div><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div><\/span><\/div>Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n
You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n
Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>
Many organizations are paying hundreds of thousands of dollars to consultants to implement purchasing best practices. These consultants impress executives with their knowledge of the purchasing profession and their use of terms such as “commodity teams,” “process mapping,” and “total cost of ownership.” Many of these terms are simple names for principles that we apply daily. Here are a few terms and their definitions:<\/p>\n
Benchmarking:<\/b> The comparison of one organization’s purchasing performance indicators or processes with those of other purchasing departments or external sources.<\/p>\n
Buying Plan:<\/b> A document prepared annually that summarizes the purchasing department’s approach to acquiring each major group of products and services. The buying plan usually includes a forecast of demand, an estimate of spending, and the actions taken by the purchasing department to prudently manage the purchase of each group of products and services.<\/p>\n
Commodity Team:<\/b> A group of individuals representing various departments who are responsible for making key decisions relative to the purchase of a product or service.<\/p>\n
Process Mapping:<\/b> The act of creating a diagram that illustrates all tasks and decisions associated with a process.<\/p>\n
Stakeholders:<\/b> Individuals within an organization who have a vested interest in a specific product or service to be acquired.<\/p>\n
Strategic Plan:<\/b> A document that outlines a long-range approach to purchasing and is closely associated with organizational strategy.<\/p>\n
Total Cost of Ownership:<\/b> An estimate of all costs associated with the acquisition, use, and disposal of a product or service.<\/p>\n<\/div><\/div><\/div><\/div><\/div> Are you tired of not getting enough opportunities, respect, and money out of your procurement career? Well, guess what? Nothing will change unless you take action towards becoming a world-class procurement professional.<\/p>\n Earning your SPSM Certification is the action to take if you want to bring the most modern procurement practices into your organization and achieve your career potential. Download the SPSM Certification Guide today to learn how to get started on your journey to a more rewarding procurement career!<\/p>\n<\/div> Are you a procurement leader whose team isn\u2019t achieving the results you know are possible? Maybe it\u2019s not enough cost savings. Or frustrating performance from the supply base. Or dissatisfied internal customers.<\/p>\n You need a performance improvement plan that\u2019s easy to implement and quick to produce results. The NLPA can help.<\/p>\n Download our whitepaper \u201cThe Procurement Leader\u2019s Guide To A More Successful Team.\u201d You\u2019ll learn the 7 steps for transforming your staff into a results-producing, world-class procurement team.<\/p>\n<\/div>Do You Want a More Rewarding Procurement Career?<\/h5><\/div>
<\/span><\/div>Need Better Performance From Your Procurement Team?<\/h5><\/div>
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