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STRATEGIC PROCUREMENT PLANNING - ✔✔Provides the processes and tools to
modernize public sector efforts around improving service development and delivery
system
SWOT analysis - ✔✔strengths, weaknesses, opportunities, threats
PARETO PRINCIPLE - ✔✔80/20 Rule
80% of Purchasing Cost is created by
20% of the purchase orders issued
Spend Analysis - ✔✔Collecting, classifying, and analyzing the expenditures data from
all sources within the organization.
PROCUREMENT PROFILE - ✔✔Result produced after conducting a series of various
analyses on the procurement expenditures of an organization, the range of commodities
and services acquired through procurement. Adds decision making intelligence to
spend analysis.
BUYING PLAN - ✔✔Based on demand, market and supplier analysis
EVALUATION STRATEGIES - ✔✔• Price analysis
• Cost analysis
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, • Life Cycle Costing
RESEARCH TECHNIQUES - ✔✔Procurement professional must use Market Research
to better understand The Who, what, when, why and how in the market.
MARKET RESEARCH - ✔✔Identify the most beneficial method for acquiring,
distributing and supporting supplies and services
FORECASTING - ✔✔Tool to determine future needs. It should be used to determine the
type of solicitation, such as a spot bid or term contract, based upon market fluctuations
and conditions
PURCHASING MANAGER'S INDEX (PMI) - ✔✔WELL ESTABLISHED AND
RELIABLE INDICATOR THAT IDENTIFIES HIGHS AND LOWS IN THE ECONOMY
FIXED PERIOD AVERAGE - ✔✔A mathematical calculation used to divide the total
usage for a fixed period (generally 12 months). This method will reflect old patterns and
not current directions.
Moving Average Method - ✔✔Continuous average method used to gather the most
current usage information about an item, by taking current trends into accountant
always using the most recent data.
weighted moving average method - ✔✔Builds even more accuracy into the system by
giving more significance to weighting specific information such as seasonal variations
Mean Absolute Deviation (MAD) - ✔✔Importance of using deviations in forecasting is
the ability to look at anticipated high and low side of any given forecast.
Absolute Value of Errors/Number of Errors
The smaller/lower the value of MAD, the more accurate the forecast.
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