Building Trust in Procurement: Why Transparency and the Right Metrics Matter
- Tracey Shearer
- Jun 2
- 2 min read
In today’s increasingly performance-focused environment, procurement is being asked to do more than reduce costs. Executives and boards are looking to procurement functions to deliver measurable value, manage risk, support ESG goals, and ensure operational resilience. But how do we demonstrate that value clearly and credibly?
The answer lies in transparency. And transparency begins with the right performance metrics.
Why Metrics Matter
Procurement functions that track the right KPIs can provide confidence to leadership that they are delivering results aligned with the organisation’s strategic objectives. When these metrics are underpinned by robust data and monitored consistently over time, they tell a powerful story:
They build trust: Accurate, transparent reporting helps stakeholders understand what procurement is delivering, and where it is making an impact.
They support decision-making: Real-time, actionable insights allow leaders to pivot or invest with confidence.
They demonstrate alignment: Metrics that reflect enterprise goals (not just procurement ones) position the function as a strategic partner.
What Should We Be Measuring?
While every organisation will have unique priorities, high-performing procurement teams often measure across six key areas:
Financial and Commercial Performance Realised savings, cost avoidance, and procurement ROI remain vital — but should be tracked alongside missed opportunities and value leakage.
Spend and Category Analytics Visibility of spend by category, supplier, and cost centre enables informed strategy development, improved compliance, and better demand management.
ESG and Risk Metrics Increasingly, procurement is accountable for Scope 3 emissions, modern slavery risk management, and Indigenous supplier engagement. Reporting on these areas supports broader organisational ESG goals.
Contract and Supplier Performance Metrics like contract coverage, renewal pipeline, supplier delivery performance, and compliance with SLAs provide assurance of value and risk management.
Supply Chain Efficiency Inventory turnover, stock availability, write-offs, and fulfilment metrics (like DIFOT) reflect the operational efficiency and resilience of the supply base.
Stakeholder Satisfaction and Influence Internal satisfaction scores, procurement cycle times, and business engagement in sourcing decisions help measure procurement's influence and service quality.
From Reporting to Real Impact
Having the metrics is only part of the story. Procurement leaders must be able to interpret and communicate what the data is showing — and ensure it's tied to trends, not just one-off snapshots. A transparent, well-structured reporting framework builds internal credibility, enables proactive decision-making, and allows procurement to influence at the executive table.
Final Thoughts
In a climate where accountability and strategic alignment matter more than ever, procurement functions need to prove their value. The right metrics — tracked over time and aligned to the organisation's goals — are one of the most powerful tools to do just that.
Transparency isn't just a principle. It's a performance advantage.
Want help establishing the right KPI framework for your procurement function? August Consulting specialises in procurement performance and analytics strategies that drive measurable outcomes. Get in touch to learn more.
Comments