Training on Strategic Cost and Value Management in Procurement

Strategic cost management is critical for all firms and is becoming increasingly significant. As global economic conditions raise the emphasis on cost reduction to sustain profitability, expenses must be managed in ways that assure continued performance in vital areas while also increasing value for the business and stakeholders overall. This supply chain training program on strategic cost and value management guides participants through the creation and application of well-thought-out cost-management strategies that also boost quality and productivity.

Target Participants

This course is ideal for supply chain and procurement professionals, project managers, finance staff, operational staff, government officials, and any other professionals who want to build their skills in supply chain management.

Course Duration

Online                     7 Days

Classroom-based     5 Days

What You Will Learn

By the end of this course the participants will be able to:

• Identify the major costs drivers to recommend cost control measures and strategies.
• Understand how cost and management accounting information affects the strategic and operational decisions within the organization.
• Understand and manage supplier pricing models.
• Maximize value for money.
• Improve profitability by controlling total costs.

Course Outline

Understanding the Value Proposition of Procurement to an Organization 

• Linking organization and procurement objectives
• KPIs to measure procurement performance.
• Procurement organizational structures
• Common requisition-to-pay and contract management systems.
• Private and public procurement policies

Setting the Strategic Direction

• The strategic planning process & models
• Porter’s 5 forces model
• Routes to competitive advantage
• Price, cost, and value
• Essential cost drivers and potential savings
• Stages to world-class cost management

Price Down – Understanding and Managing Price

• Supplier pricing models
• Krajlic supply positioning matrix
• Methods of price analysis
• Strategies and tactics
• Competition and partnership – routes to better pricing

Cost Down – Analyzing and Managing Internal and Supplier Costs

• Total cost of ownership/life cycle costing
• Methods of cost analysis
• Major elements of cost
• What and how important are supplier overheads?
• Sources of cost information
• Logistics costs

Driving Cost Out – Supplier Engagement and Cost Elimination

• Inventory, warehousing, and shipping costs including economic order quantity.
• Cost-volume-profit analysis and break-even analysis
• Cost engineering
• Fixed and variable costs defined.
• Contract Performance Management
• Checking supplier value
• Profit and risk sharing
• What-if analysis to build scenarios and test sensitivity

Implementing Strategic Cost Management

• Barriers to strategic cost management
• Cost-cutting traps and how to avoid them.
• Types of budgets, their purpose & limitations
• Types of controls – personnel action & results controls
• Tools and Techniques in Decision Making

Training Approach

This course is delivered by our seasoned trainers who have vast experience as expert professionals in their respective fields of practice. The course is taught through a mix of practical activities, theory, group work, and case studies.

Training manuals and additional reference materials are provided to the participants.

Certification

Upon successful completion of this course, participants will be issued a certificate.

Tailor-Made Course

We can also do this as a tailor-made course to meet organization-wide training needs. A training needs assessment will be done on the training participants to collect data on the existing skills, knowledge gaps, training expectations, and tailor-made needs.

Strategic cost management is critical for all firms and is becoming increasingly significant. As global economic conditions raise the emphasis on cost reduction to sustain profitability, expenses must be managed in ways that assure continued performance in vital areas while also increasing value for the business and stakeholders overall. This supply chain training program on strategic cost and value management guides participants through the creation and application of well-thought-out cost-management strategies that also boost quality and productivity.

Target Participants

This course is ideal for supply chain and procurement professionals, project managers, finance staff, operational staff, government officials, and any other professionals who want to build their skills in supply chain management.

Course Duration

Online                     7 Days

Classroom-based     5 Days

What You Will Learn

By the end of this course the participants will be able to:

• Identify the major costs drivers to recommend cost control measures and strategies.
• Understand how cost and management accounting information affects the strategic and operational decisions within the organization.
• Understand and manage supplier pricing models.
• Maximize value for money.
• Improve profitability by controlling total costs.

Course Outline

Understanding the Value Proposition of Procurement to an Organization 

• Linking organization and procurement objectives
• KPIs to measure procurement performance.
• Procurement organizational structures
• Common requisition-to-pay and contract management systems.
• Private and public procurement policies

Setting the Strategic Direction

• The strategic planning process & models
• Porter’s 5 forces model
• Routes to competitive advantage
• Price, cost, and value
• Essential cost drivers and potential savings
• Stages to world-class cost management

Price Down – Understanding and Managing Price

• Supplier pricing models
• Krajlic supply positioning matrix
• Methods of price analysis
• Strategies and tactics
• Competition and partnership – routes to better pricing

Cost Down – Analyzing and Managing Internal and Supplier Costs

• Total cost of ownership/life cycle costing
• Methods of cost analysis
• Major elements of cost
• What and how important are supplier overheads?
• Sources of cost information
• Logistics costs

Driving Cost Out – Supplier Engagement and Cost Elimination

• Inventory, warehousing, and shipping costs including economic order quantity.
• Cost-volume-profit analysis and break-even analysis
• Cost engineering
• Fixed and variable costs defined.
• Contract Performance Management
• Checking supplier value
• Profit and risk sharing
• What-if analysis to build scenarios and test sensitivity

Implementing Strategic Cost Management

• Barriers to strategic cost management
• Cost-cutting traps and how to avoid them.
• Types of budgets, their purpose & limitations
• Types of controls – personnel action & results controls
• Tools and Techniques in Decision Making

Training Approach

This course is delivered by our seasoned trainers who have vast experience as expert professionals in their respective fields of practice. The course is taught through a mix of practical activities, theory, group work, and case studies.

Training manuals and additional reference materials are provided to the participants.

Certification

Upon successful completion of this course, participants will be issued a certificate.

Tailor-Made Course

We can also do this as a tailor-made course to meet organization-wide training needs. A training needs assessment will be done on the training participants to collect data on the existing skills, knowledge gaps, training expectations, and tailor-made needs.