This measure determines the percentage of purchase value that comes from certified vendors. To be a certified vendor, the entity must be a supplier of goods and services with whom the business unit has prearranged purchasing agreements that include the supplier being responsible for quality of incoming goods or services. This measure is part of a set of Process Efficiency measures that help companies optimize the performance of their "procure materials and services" process by minimizing waste and refining resource consumption.
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Percentage of purchase value from certified vendors
Process efficiency represents how well a process converts its inputs into outputs. A process that converts 100% of the inputs into outputs without waste is more efficient than one that converts a similar amount of inputs into fewer outputs.