In the procurement profession, there is a broad set of external factors which directly affect organizational performance: customers, policy, staff, processes, vendors, tools, and organization. Regardless of whether the external factors are enabling or inhibiting, the procurement function must deliver value — usually in the form of cost savings, enhanced vendor performance, and mitigated legal and operational risk. That’s why the The Procurement Maturity Model (PMM) was developed to assist procurement professionals in implementing procurement best practices as a means to improve organizational performance.
One of the things the Procurement Maturity Model (PMM) facilitates [is] the process of benchmarking by pre-defining over 60 procurement best practices. These best practices may include:
- the Procurement organization involved in 95%+ of spend
- purchase orders electronically generated for 80%+ of spend
- 75%+ of spend flows through approved vendors
- 80%+ of contracts executed within 30 calendar days;
95%+ of contracts executed within 60 calendar days
- Procurement staff receives 24+ hours of training annually
The model enables a gap analysis between an organization’s performance and the corresponding performance of a best-practice enabled organization and, based on the gap, identifies measures and actions the organization can take to become best-in-class.
For more information on the Procurement Maturity Model and how it can help you become World Class, check out the presentation that Stephen Guth (of the Vendor Management Office blog) was going to deliver at ISM*1 (who I’m going to call a hot dog vendor of procurement certifications), available for download through this post.
*1 I’ll agree that the presentation is pretty basic, but you can’t tell me it’s more basic than most of the material that they publish on a regular basis, or most of the presentations they accept, or that a significant portion of their audience, unfamiliar with the PMM, would not benefit from a good introduction. Especially one from an experienced practitioner and speaker who wrote the book on The Vendor Management Office.