Procurement KPIs
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Lead time
Lead time
Lead time refers to the duration between initiating a process and its completion
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The average amount of time it takes for a delivered item to be acknowledged

KPI Definition

Lead Time refers to the duration between the initiation of a purchase order and the receipt of the ordered goods or services. It represents the time taken for suppliers to fulfill an order and deliver it to the buyer

Business Value

Lead time is useful for analysisng the average amount of time it takes for a delivered item to be acknowledged, a business should be focused on making this faster

Movement Direction

Sample Formula

AVG (Item_Delivery_Date - PO_Acknowledgement_Date)

Should Aim For
1
This metric should move down ie., decrease with time
2
3
Track Similar KPIs
General Ledger accounts
General ledger accounts are individual accounts used to record financial transactions
Running Projects
The projects which are ongoing
Delayed PO Payment
the payment for goods or services provided under a purchase order (PO) is postponed
Payment
total amounts for all payments
Delayed Non PO Payment
the payment for goods or services provided without a corresponding purchase order (PO) is postponed
Delay in payment
time delay for payment
Contracts updated
the process of updating or renewing contracts is postponed beyond the expected or agreed-upon timeframe.
Cycle time for invoice posting
the duration from when an invoice is received to when it is processed and recorded in the organization's financial systems.
Preferred vendors
suppliers or vendors that have been designated as preferred
Project Amount
total monetary value assigned or budgeted
Unutilized Project Budget
the portion of allocated funds or resources for a procurement project
Target cycle time for project closure
ideal timeframe within which the procurement project should be completed
Projects
Projects refer to specific initiatives or endeavors undertaken
Project estimated saving
Project estimated saving
Project Cycle time
Project cycle time refers to the duration it takes to complete a specific procurement project
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