What is the most important KPI in a procurement department: 1- Cost saving 2- Continuity of supply 3- Inventory reduction ?

All the three KPI's are key factors in Procurement

from my own point of view and personal experience i always try to apply JIT techniques.

so i will always work on maintaining the lowest possible inventory.

inventory has a cost. 

so in answer to your question it is INVENTORY

All the three KPI's are key factors in Procurement whereas Cost saving would make great changes in Business and to achieve the cost savings by maintaining minimum required inventory and maximum supply safety.

Cost saving and Inventory reduction are one of the same KPI's.

In my business we have reduced our inventory to an acceptable level and made a major cost saving.

Managing and monitoring Inventory is an invaluable KPI and one I consider most important.

As a manager make sure you carry out your own inventory percentage checks each week/month, Your own KPI on yourself will also prove interesting and will enable you to pick up trends so much quicker

Hope this helps

From my little experience, I believe that in Supply Chain (each process, department and procedure is important and completing the others) and they are moving successfully by applying (Total Quality Management - TQM).

I agree with '' Cost Saving ''  as a key one. Because if you achieve it, then you will be able to continue the supply, and inventory reduction.

Best Regards,

The good sourcing strategy lead to the cost saving issues  , the good management of stock material lead to the policy of minimizing inventory , healthy financement managing laed to the contunuity supplying .

well i consider Inventory reduction since less Inventory would result in reduction in WAREHOUSE cost and will also result in COST SAVING

As experienced as Deputy Manager Procurement, I find it as Cost saving

I believe that Continuity of Supply is the most important KPI for any  Procurement Department. This makes the whole show running and operations of the concern are made possible. Other KPIs are important to make the organization a profit earning one in the long run. But the Continuity of Supply is a matter of life and death for the organization. 

Dear Sir,

With all consideration and success, the KPI is the Key Performance Indicator Plan. The company is using KPI to reduce and saving cost. The company should consider what is important to purchase? and when? Which is depending on measuring of market performance, company financial wise/limit, expiry date of products or product life in Inventory (if there) and inventory space cost.

In case the company deals with different products, the Procurement Dept. should cooperate with Sales/Marketing Dpt. To know which products do market needed frequently or monthly but other products could be quarterly or every6 months etc….

That also means, at the same time you should consider the continuity of supply and your stock or inventory balanced and up to date with less inventory space to reduce cost.  

Finally, the3 points should be considered in The KPI Plan and it should be studied very well and approved by the Organization Top Management and Procurement Management Dept.

Hope i supported you with the right answer and wish you good luck.