Nikolaeva A.G. Development of Procurement Performance Indicators or Industrial Enterprises of the Russian Federation

Abstract

Problem Statement (Relevance): Industrial enterprises are working in the highly competitive world market having irregular demand for the products. Under the present conditions enterprises need to improve their operation to keep their positions in the market, and as any production is material-consuming, procurement becomes the most important element influencing the competitiveness of the enterprise in the market. Even small improvement of purchasing processes can become a decisive factor in the competition. To ensure efficient management and optimal strategic decision-making in the field of purchasing, it is necessary not only to analyze external environment, but also assess the purchasing activities of the organization regularly. However, at present, there is no unified set of indicators allowing us to assess procurement performance of industrial enterprises. Objective of the research: To develop the balanced system of procurement performance indicators for industrial enterprises of the Russian Federation. Novelty of the research: For the first time, we propose the mechanism to make an integrated quantitative assessment of procurement performance of industrial enterprises based on the balanced scorecard. Findings: Applying the research performed and summarized data on procurement performance criteria and indicators proposed by both foreign and Russian authors, we developed the balanced system consisting of 29 indicators, including financial performance, business process indicators, training and development of personnel as well as the indicators focusing on satisfying the clients’ requirements. Practical Relevance: The developed set of indicators is a complete tool used to assess procurement of any Russian enterprise and then to take efficient management decisions on purchasing based on obtained quantitative data.

Keywords

Procurement, purchasing, procurement performance assessment, procurement performance indicators, industrial enterprises.

Anna G. Nikolaeva – Head of the Education and Methodology Department, Higher School of Technology and Energy, Saint Petersburg State University of Industrial Technologies and Design, Saint Petersburg, Russia. E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

1. Nikolaeva A.G., Tereshkin M.V. Assessing the influence of procurement on operation performance of pulp and paper industry enterprises. FES: Finansy. Ekonomika. Strategiya. [FES: Finance. Economics. Strategy], 2018, no. 5, pp. 37–44. (In Russ.)

2. Sosunova L.A., Karpova N.P. Strategic management in the transportation services market. Vestnik Samarskogo gosudarstvennogo ekonomicheskogo universiteta. [Vestnik of Samara State University of Economics], 2011, no. 3(77). (In Russ.)

3. Zimina G.A., Rastegaeva F.S., Shashkova T.N. Methodological aspects of analysis and assessment of purchasing efficiency at oil refineries. Mezhdunarodny nauchno-issledovatelsky zhurnal. [International research journal], 2015, no. 4(35), vol. 2, pp.22–26. (In Russ.)

4. Lysons K., Gillingham M. Upravlenie zakupochnoy deyatelnostyu i tsepyu postavok [Purchasing and supply chain management]. Moscow: INFRA-M, 2014, 795 p. (In Russ.)

5. Kirillova N.L. Key performance indicators of the supply system. Internet-proekt: Korporativny menedzhment: www.cfin.ru [Internet project: Corporate management: www.cfin.ru]. Available at https://www.cfin.ru/management/manufact/ procurement_kpi.shtml (Accessed: August 23, 2019).

6. Leenders M.R., Fearon H.E. Upravlenie snabzheniem i zapasami. Logistika. [Purchasing and supply management. Logistics.]. Moscow: Victoria-plus, 2006, 768 p. (In Russ.)

7. Leenders M., Johnson F., Flynn A., Fearon H. Upravlenie zakupkami i postavkami [Purchasing and supply management]. Moscow: UNITI-DANA, 2015, 751 p. (In Russ.)

8. Parmenter D. Klyuchevye pokazateli effektivnosti. Razrabotka, vnedrenie i primenenie reshayushchikh pokazateley. [Key performance indicators. Developing, implementing and using winning KPIs]. Moscow: CJSC Olymp-Business, 2008, 288 p. (In Russ.)

9. Kirnos O.V., Tkach T.V. Organizational and economic factors influencing logistical costs of the enterprise management system of the construction complex. Vestnik Pridneprovskoy gosudarstvennoy akademii stroitelstva i arkhitektury [Bulletin of the Prydniprovska State Academy of Civil Engineering and Architecture], 2009, no. 10(139), pp. 35–41. (In Russ.)

10. Pankov S.N. Procurement efficiency assessment: experience of the Tyumen Region. Elektronny finansovo-ekonomichesky zhurnal “Byudzhet” [Budget electronic financial and economic journal], 2019, no. 3. Available at http://bujet.ru/article/370017.php (Accessed: August 23, 2019).

11. Novozhilov V.V. Problemy izmereniya zatrat i rezultatov pri optimalnom planirovanii [Problems of measurement of costs and results for optimal planning]. Moscow: Science, 1972, 81 p. (In Russ.)

12. Afanasenko I.D., Borisova V.V. Logistika snabzheniya. [Supply logistics]. St. Petersburg: Piter, 2010, 336 p. (In Russ.)

13. Surzhikov M.A. Macroeconomic modeling of guidelines for international trade development. Vestnik Donskogo gosudarstvennogo tekhnicheskogo universiteta [Vestnik of Don State Technical University], 2012, no. 12(2-1), pp. 135–141. (In Russ.)