PurchTips - Edition # 169

 

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Picture of Charles Dominick, SPSM, SPSM2, SPSM3

The Wrong Cost Savings Goal

By Charles Dominick, SPSM, SPSM2, SPSM3

Is Your Cost Savings Goal Wrong Or Right?

It's the New Year. New years bring new goals, right?

Well, there is a purchasing goal that is both common and wrong. That wrong goal looks similar to this: "Achieve cost savings of $500,000 this year."

You may ask, "Why is this wrong? This is almost identical to my goal!"

The reason is apparent when you compare it to an example of a goal that is right: "Achieve a cost savings of $500,000 this year while maintaining or improving supplier performance." Too often, unskilled purchasers try to achieve cost savings goals by replacing old suppliers with cheaper suppliers who fail to meet performance standards. That's unacceptable and may actually reduce profits instead of increasing them.

As a talented, modern purchaser, you must get the best price while evaluating and qualifying suppliers that will perform better than the incumbent. This means improving on-time delivery, material defect rates, supplier service levels and internal customer satisfaction on top of getting a lower price.

Also consider that achieving cost savings does not always mean finding new suppliers. If ever there was a time ripe for negotiating with incumbent suppliers, it is in today's weak global economy. Retaining existing suppliers - provided that they are financially healthy - is one way of mitigating the risk of having supplier performance degrade.

So be sure to mention supplier performance in your cost savings goals! And if you're not in a position to rewrite your "wrong" cost savings goal, share metrics showing maintained or improved supplier performance when reporting your actual cost savings throughout the year. It will show management and internal customers that you know the importance and impact of modern purchasing.

(keep reading for a FREE Offer)

Spotlight On Professional Development Opportunities

SPSM Certification

Are you tired of not getting enough opportunities, respect, and money out of your purchasing career? Well, guess what? Nothing will change unless you take action towards becoming a world-class purchasing professional.

You see, today's employers refuse to reward employees for yesterday's skills.They demand that purchasing professionals like you use the most modern skills and achieve unprecedented results. They want you to save more money, achieve better operational performance, and reduce risk.

Is lacking a purchasing certification keeping you from getting the results, opportunities, respect, and money that you want out of your career? Today's employers refuse to reward employees for yesterday's skills. They want you to save more money, achieve better operational performance, and reduce risk. They demand that purchasing professionals like you achieve unprecedented results and without the most modern skills that can be a challenging feat!

So how can you acquire the most modern skills, achieve meaningful results, and convincingly prove your capabilities to today's employers? There is an impressive purchasing certification program that will teach you what you need to accomplish all of this and more. It is the SPSM® Certification, earned by completing the Senior Professional in Supply Management® Program. And you could earn it in less than a year - maybe even much less than a year!

Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) (with the option of getting a Study Guide on an iPad) at:

Distinguishing yourself as an achiever in purchasing is key to sustaining a rewarding career, even in these difficult economic times. Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) at:

Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices  into your organization and achieve your career potential. And if you sign up for the Senior Professional in Supply Management® Program on or before May 31, 2008, SPSMSM Certification Program on or before 4/30/2007, you also get these and other bonuses valued at over $700:

  • FREE $30 gift certificate to Amazon.com!
  • FREE CD-ROM with printer-friendly versions of the class materials!
  • FREE Purchasing Performance Measurement spreadsheet template!
  • FREE audio CD about purchasing job security!

To learn how to earn your SPSM® Certification and get these valuable bonuses, visit:

Earning your Senior Professional in Supply Management® (SPSM) Certification is the action to takeif you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSMSM Certification at:

Learn how to earn your SPSM® Certification at:

www.NextLevelPurchasing.com/spsm.html



The Latest Purchasing News

  • Purchasing Managers/Directors: Do you have a clear plan for getting better performance out of your purchasing team in the New Year or are you going to wing it? We can help you build a roadmap for improvement. Learn if you qualify for our FREE purchasing skills benchmarking service at: www.NextLevelPurchasing.com/benchmark
  • How does today's topic relate to your work? Discuss it with your peers in the LinkedIn SPSM Group at: www.linkedin.com/groups?gid=145761
  • Not a member of the LinkedIn SPSM Group? Learn how to join for free at:http://tinyurl.com/8tgfnd
  • Considering a career move? Browse over 80 jobs preferring candidates with the SPSM® Certification at: www.NextLevelPurchasing.com/jobs

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There are four irreversible business and technology trends that are likely to cost purchasers like you their jobs in the next 12 months. Do you know what they are? Do you know how to protect yourself from their effects? If not, you should get your FREE report entitled "Career Survival In Supply Management."

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Free Procurement Training & Certification Starter Kit

This Starter Kit gives procurement professionals like you a clear idea on what it will take to become certified. You'll get an excellent feel for what you will need to learn and how long it will take.

Click here to learn more

Included in your free Starter Kit:

  • Access to two lessons from courses that are part of the Senior Professional in Supply Management® Program
  • A Certification & Training Planning Template
  • Case studies
  • A free Basic Membership in the NLPA

Together, these materials will help you decide how well the SPSM® Certification can help you achieve your career goals.

So, what are you waiting for? Begin your pursuit of a more rewarding procurement career – get your Procurement Training & Certification Starter Kit now by signing up for a free NLPA Basic Membership!

If you are already a member of the NLPA, click here to login and visit the "Starter Kit" tab to access these resources.