Many procurement organizations don’t realize they are in a virtual death spiral when it comes to cost-cutting. Procurement organizations that constantly demand lower and lower costs (often having a metric known as Purchase Price Variance) often find themselves in a painful death spiral with the companies’ supplier relationships. When a company gets in a tit-for-tat clash […]
cost-cutting
Cut If You Must, But Do it Credibly
I was reading the Harvard Business Review’s Daily Stat and discovered that a mere 10 percent of cost-reduction programs sustain their results after three years, according to research from McKinsey. Sometimes there’s no accounting for cost-accounting when it doesn’t really account for all the costs involved in an enterprise. That can really stress complex supply […]
