Smart Buyer: A Bayesian Network modelling approach for measuring and improving procurement performance in organisations

© 2017 Elsevier B.V. Procurement, the act of buying goods or services from an external supplier, plays an important role in any organisation. To measure how well an organisation undertakes this activity, it needs to measure all associated Key Performance Indicators (KPIs). The current literature's major drawback in performing such a measurement is how to integrate the different KPIs, each of which captures a specific aspect of the organisation's performance. In this paper, we highlight this drawback and present our proposed Smart Buyer framework that is based on a Bayesian Network (BN) model capable of capturing and integrating the different KPIs. The measured procurement performance value can then be used by organisations to identify the areas in which they need to improve and develop plans to achieve this. Four scenarios are presented to show how the proposed BN model can be further used for analysis and decision making within organisations. Finally, a recent real-world procurement example is studied to demonstrate the applicability of the proposed Smart Buyer framework

Fine tuning a bayesian network and fairly allocating resources to improve procurement performance

Procurement is one of the most important activities in any organization. Hence it is vital for an organization to track procurement practices. Through performance measurement, the organization will have a clear understanding on how it’s performing as well as the effect of any action that it makes towards improvement. In our previous work, we proposed a Bayesian Network (BN) model to measure the level of procurement performance in an organization. This paper extends that model in two ways. First it uses the Best-Worst Method (BWM) to adjust the impact of each KPI on the procurement performance according to its importance to the overall business strategy. Second is by using the relative importance of the KPIs, it demonstrates how procurement can be improved by re-allocating the available resources among the KPIs in a fair way

Using System Dynamics for Predicting an Organization’s Procurement Performance

Part 7: Social ComputingInternational audienceProcurement is one of the most important operations in any organization. To effectively manage this process, it is vital for the organization to measure and monitor its procurement performance. Not only measuring, but also managing and predicting the procurement performance can secure the organization a competitive edge in the market. In this paper, we propose a System Dynamics model for measuring, managing and predicting the procurement performance. Appropriate Key Performance Indicators of the procurement process have been selected as the variables of the model based on the literature of procurement performance measurement and also domain experts’ opinions. The model is then validated and some directions for future research have been discussed