For efficiency related changes the direct impact on

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Unformatted text preview: peed up the process, these cycle times can typically be reduced to a matter of days or even hours. For efficiency-related changes, the direct impact on the bottom line is often hard to measure. For example, purchasing and administrative overhead costs really only decrease if total staff levels are reduced. If all you do is cut the number of purchase orders in half and leave your staffing at the same level, then the cost to process each one simply goes up from $200 to $400. More frequently, staff are reassigned to projects and activities that have higher potential value to the company but were previously not addressed. Determining the real business value of these efficiency-related e-procurement solutions requires asking the question “What new things are we doing now that we are freed from this administrative burden, and what is the measurable value to the organization?” Frankly, the answer is often not well known. Finally, efficiency-related solutions rely on Objective: Efficiency Gains using supplier contracts a...
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This test prep was uploaded on 04/01/2014 for the course INDE 6370 taught by Professor Staff during the Spring '08 term at University of Houston.

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