To identify and focus on key performance metrics in the industrial machinery, a leading CNC machine manufacturer approached SpendEdge to devise a comprehensive approach that would help them identify and benchmark the procurement best practices. The client also wanted to identify and benchmark the procurement best practices to improve organizational growth. During the course of this engagement, a detailed quantitative analysis of various categories within the supply chain was carried out to identify and benchmark the procurement best practices to be followed.
About the Client
A world leader in the production of CNC machines, headquartered in the United States.
The CNC machine manufacturer was facing challenges in identifying and benchmarking the procurement best practices of their competitors.
How did SpendEdge Help the Client?
Step 1: Analyzing gathered data to determine gaps
A detailed analysis of the gathered data helped the CNC machine manufacturer to determine the extent to which their present performance lags when compared to the best in their industry segment. The implementation of this step offered a clear picture of their business processes compared to that of their peers.
Step 2: Determined and analyzed the processes to be benchmarked
This step revolved around the process of categorizing and defining the procurement best practices to be benchmarked. This is one of the crucial steps in identifying the best practices as an incorrect identification at the initial stage could result in the expenditure of valuable resources.
Key questions answered in this case study
Benefits of the Engagement
With the help of SpendEdge’s procurement best practices engagement, the CNC machine manufacturer identified the key performance metrics to fine-tune their procurement strategies and drive growth. SpendEdge’s procurement experts also worked as an extension team for the client to help them identify the success factors that uncovered major opportunities for improving their products.
Why incorporate procurement best practices?
Procurement best practices benchmarking is not blindly ‘replicating’ what competitors do. It helps organizations gain detailed actionable insights into the acceptable standards in the industrial machinery industry. This makes it a necessity for any business to understand where they stand with regards to a specific industry standard.
CNC machine manufacturers sometimes devote their time and energy to focus entirely on achieving their business goals. Such an approach to drive organizational growth not only steers the firm from the focused path but also isolates the company from learning from the activities occurring in the business environment. Therefore, an essential way to prevent this from occurring is to constantly keep abreast of the procurement best practices and gauge the benchmarks periodically.