There’s a long-standing debate in Procurement about how to track realized savings. Are procurement professionals expected to reconcile numbers like accountants, or is there a better way to measure procurement performance metrics without losing focus on strategy?
Drawing on insights shared during a recent Art of Procurement session, Yannick Caharel, Global Head of Procurement at Christian Dior Couture, explains how his procurement team tracks performance in a way that builds trust, improves procurement efficiency, and supports better management decisions—without turning Procurement into a secondary accounting function.
Why Procurement Performance Metrics Matter
In today’s industry, Procurement leaders are under pressure to prove impact across cost, efficiency, and the broader supply chain. Yet many companies still rely on narrow definitions of savings that fail to reflect the full scope of procurement activities and procurement operations.
Well-designed procurement performance metrics help the procurement department:
- Measure impact beyond price alone
- Improve decision-making across the procurement process
- Align Procurement with Finance and business stakeholders
- Identify cost saving opportunities and areas for improvement
The challenge is choosing the right metrics and key performance indicators to tell that story.
The Problem With Tracking Realized Savings Alone
You’re no stranger to skepticism around Procurement claims. Even accurate data can be questioned if stakeholders don’t understand how it was calculated or what it represents. This is where many procurement leaders struggle: trying to reconcile savings dollar-for-dollar against projected outcomes, often at the expense of strategic work.
As Phillip Ideson and SpendHQ’s Chief Product Officer Pierre Laprée discussed, treating realized savings as the sole procurement KPI creates several problems:
- Talent burnout, as teams focus more on reconciliation than strategic sourcing
- Less time spent identifying new opportunities across suppliers and vendors
- Reinforcement of Procurement as a cost center rather than a value driver
From a cost-benefit standpoint, the effort required to reconcile every dollar often outweighs the insight gained—especially when it does little to improve operating costs, efficiency, or outcomes.
Make everything you do visible
When you don’t have exact data around realized savings, you need to replace it with something equally compelling. Otherwise, your trust and alignment with the rest of the business will suffer. The most reliable way to solve this issue is to report on your performance instead, not so you can focus on how great you and your team are, but so you can still tell the impact story from a different angle.
That means tracking everything–your projects, your goals, their reported and projected outcomes, their delays–everything. Tracking your performance with this level of granularity is far easier and completely within your control, but it answers almost all of the questions the business could ask about realized savings in a given time frame.
As Caharel explained, “People really trust what they see… [Performance Management] allows me to see an online platform where we record all the projects, all the budget, all the savings, all the documentation, and so on. It allows me to make the link with Finance, with top management, and so on. So I’m not anymore doing 60 pages of presentation. The moment I go to New York, Shanghai, or Dubai, I just log in to the PPM module so we have a proper business review based on true projects, true realization whether it’s identified, completed, ongoing, or so on.”
This level of granularity matters because, as Laprée, a long-time Procurement expert, admits, even exact data around realized savings will never be perfect. But when you can lead the conversation by thoroughly documenting everything Procurement has been involved with, you can answer the once uncomfortable questions about what your work really means for the business.
Shift the Focus to Procurement Performance Metrics
Instead of obsessing over perfect savings attribution, Caharel recommends focusing on procurement metrics that show how work gets done and what value it creates.
That means making Procurement’s work visible by tracking:
- Projects and initiatives
- Expected and realized cost savings
- Timelines, delays, and dependencies
- Alignment with broader procurement strategies
This approach provides a more complete picture of procurement teams performance and enables leaders to answer business questions without relying solely on financial reconciliation.
What to Measure: Core Procurement Performance Metrics
Strong procurement performance metrics go beyond savings alone and reflect how well the function operates day to day.
Key areas to track include:
Efficiency and Process Metrics
- Procurement efficiency across sourcing and purchasing cycles
- Purchase order cycle time and accuracy
- Adherence to the defined process and contract compliance
Cost and Savings Metrics
- Realized and projected cost savings
- Identification of cost saving opportunities
- Impact on overall operating costs
Supplier and Supply Chain Metrics
- Supplier performance across delivery, quality, and risk
- Supplier lead time and reliability
- Strength of the supplier relationship and adherence to each supplier contract
Quality and Delivery Metrics
- Quality KPIs tied to defects or rework
- Delivery KPIs measuring on-time, in-full performance
- Impact on inventory and downstream operations
Together, these metrics help measure Procurement’s contribution across the full supply chain, not just at the negotiating table.
Align Procurement and Finance on Value
Even the best procurement performance metrics won’t land if Finance and Procurement don’t agree on definitions. Laprée emphasized that misalignment often starts with unclear baselines and inconsistent expectations.
To avoid this:
- Define which procurement metrics impact the P&L and which support long-term value
- Establish agreement on baselines before projects begin
- Align on how cost savings, risk reduction, and quality improvements are measured
This shared understanding transforms reporting from a defensive exercise into a collaborative one—and improves trust across the business.
Using Procurement Performance Metrics to Tell Better Value Stories
Defining value with Finance and other business units usually involves more than a single, quick conversation. You’ll need to know how to convince, explain, and demonstrate why certain factors and metrics matter and others don’t. You’ll also need to understand how to cultivate these inter-departmental relationships to make way for these conversations in the first place.
In other words, you’ll need the soft skill of storytelling. The point we covered in this blog was part of a larger conversation on how to develop that skill by combining high-quality data with communication skills to tell meaningful value stories. Together with Art of Procurement’s Phillip Ideson and Kelly Barner, we spent an hour exploring
- How telling better ‘value’ and ‘data’ stories can enhance procurement’s internal brand and impact
- The importance of properly addressing your audience with the metrics and KPIs that matter to them
- Why measuring value and then presenting it properly is such a powerful combination
Procurement Performance Metrics as a Strategic Advantage
High-performing procurement teams don’t measure for the sake of reporting. They use metrics to guide procurement strategies, improve procurement operations, and strengthen relationships with internal and external stakeholders.
By focusing on performance rather than perfection, Procurement can:
- Improve price competitiveness
Strengthen supplier relationships - Support sustainable sourcing goals
- Drive continuous improvement across the organization
To listen to the full live session and learn how you can move beyond presenting and defending your data, click here to watch the full session.