What is meant by the term Procurement Controlling?

Procurement controlling and procurement performance management are two synonyms for the same functional area. The terms describe the tasks of supporting both strategic purchasing and operative purchasing with methods, processes, data, key figures, analyses and software.

The objective is to efficiently manage the functional area of purchasing as a whole and to coordinate it with the predefined corporate goals. For this reason, procurement controlling usually linked very closely to financial controlling. In some companies, procurement controlling is subordinate to financial controlling, or even part of the finance department, so that no separate procurement controlling exists.

The key figures used in procurement controlling are specifically orientated toward the functional area of procurement, and within that, are positioned in particular toward strategic purchasing. They are mainly comprised of key figures concerning purchasing successes or savings (e.g. the so-called changes in material prices or negotiation successes), as well as key figures in regard to reporting areas such as compliance, automation and processes, procurement volumes/ spend, conditions, working capital, quality, supplier reliability, supplier evaluations and many more.

The responsible employee working in procurement performance management is referred to as the performance manager or manager of performance management (in purchasing). This position is equivalent to that of the purchasing controller. The performance manager reports directly to the chief procurement officer (CPO) in most cases. The purchasing controller provides services for both the individual purchasers and the finance department.

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