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Purchasing Magazine Article

Purchasing Magazine Article - result The crime in the...

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Cost Modeling for Procurement Professionals “There is one rule for the industrialist and that is: Make the best  quality of goods possible at the lowest cost possible” Henry Ford The key is to find out if we are at the lowest cost possible. This has always been  the challenge of the procurement professional. A number of techniques are being  employed to insure the costs are competitive. The key is to understand the  production source costs in order to be able to optimize the deliverable to the  customer. Cost Modeling is similar to the popular investigation shows. You start with the  end result and work to define what sequence of events occurred to cause the 
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Unformatted text preview: result. The crime in the television show is usually carried out after careful planning and methodical execution. Cost Modeling also involves planning in the way of process and production planning. The execution of the production process can be determined and calculated to reveal a definitive result. After spending almost ten years in the manufacturing environment I started my second career in the procurement function. It was a new world of supplier interaction (some cooperative and some confrontational) and project tracking. I often wondered how the supplier developed the costs and...
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