Einkauf, Logistik und Supply Chain Management: Introduction of Return on Spend as an Indicator of Supply Management’s Financial Effectiveness

Quitt, Anna; Henke, Prof. Dr. Michael

Performance Measurement is currently one of the most talked about topics in Purchasing and Supply Management (PSM) – in research as well as in business practice. However, it is not simply a business fad; researchers already introduced the Balanced Scorecard, a performance measurement method, to PSM a few years ago. A more novel idea in this context is measuring the budget impact of PSM – its financial effectiveness. In business practice, only 10-20% of supply management’s effectiveness can be identified retrospectively in the P&L account with current measurement methods. Thus, PSM is often criticised for only being able to demonstrate its efforts on presentation charts, so-called “powerpoint savings”. Therefore, researchers were requested to support practitioners in finding a solid and feasible solution to the problem of savings measurement. The derived solution measures PSM’s financial effectiveness by integrating the function in the budgeting procedure, based on the following hypothesis: Only when supply management addresses its planned savings potential already in the budgets, it can show its comprehensive bottom line effect.

Details

Published by: Gabler Verlag

Publication Date: 2010-01-27

Format: Paperback

ISBN-13: 9783834921109

DOI: 10.1007/978-3-8349-8490-6

Dimensions: 210cm x148cm

Pages: 250