Performance Improvement through Metrics for Buyers

This case describes the author s experience running a purchasing department for one of the country s leading distributors. The challenge was to motivate a relatively inexperienced group in order to improve customer service and achieve cost-effective inventory management. 

Because of the high personnel turnover and the absence of department leadership, the quality and experience levels of the buying staff were low. In addition, for most of the buyers, this was their first job out of college. The average buyer had less than 2 years experience as a buyer — and almost all of that was at Merisel — which had few buying role models. 

I felt that a get-well-quick plan was in order. This plan needed to focus on two main things. The first was buyer education about the basic activities 

The results from this education process were very positive. The buyers felt more confident. They had a much better understanding of what was expected of them, that is, what constituted a job-well-done. Their confidence increased — and with it, their morale. 

For the second major part of the get-well-quick-plan — measuring their individual job effectiveness and identifying the appropriate steps necessary to make improvements — 1 wanted to develop some specific performance metrics. 

I felt that a get-well-quick plan was in order. This plan needed to focus on two main things. The first was buyer education about the basic activities of purchasing and inventory management and an understanding about what composed a JWD (job-well-done). The second was the need for education for each buyer on measuring his or her own job effectiveness and the appropriate steps necessary to make improvements. 

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