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Abstract
In today's economy, companies are continuing the pursuit
of competitive advantage to boost the value proposition
of the goods and services they offer. One of the main
thrusts of these efforts is cost reduction to facilitate
offering more for less - a proposition sure to attract
any consumer's attention. This search has led to a greater
interest and focus on what goes on in the purchasing
department. With an average of 50 percent or more of
all revenue in a typical company going back to the suppliers,
cost containment and reduction involves more than just
getting a few quotes and buying from the lowest bidder.
The introduction of total cost management for acquisition
and source selection, based on strategic alignment to
goals, is morphing the purchasing function into a broader
based role known as procurement.
Inside every company there is a procurement opportunity
that offers immediate savings, higher quality and gently
improved profits. By focusing on procurement spending,
companies can reduce the overall cost of materials by
12-15%. To achieve these savings, companies must develop
a systematic approach to purchasing which involves aggressively
managing product specifications and negotiations with
suppliers. This approach also requires new capabilities
and improved analytical skills.
This white paper explains how companies can be more
competitive in today's changing environment. The need
to be lean and the ability to think strategically are
more important than ever. Development of a world class
procurement contract management system will help realize
procurement best practices that in turn will lead to
significant cost savings and increased efficiency.
Author
Sourav Kumar
To know more about Wipro in enterprise application
services, go to www.wipro.com/eas
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