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Contract approval process for procurement

-30%
Reduced process costs

0
Production plan failures

Customer

Machine-building enterprise of the complete production cycle (from R&D to service).

Problem / Challenge

Long lead times in negotiating contracts sometimes lead to missed deliveries of required raw materials.At the same time, audits of the QMS and recording of performance discipline in the electronic document management system did not reveal any serious violations.


Analysis

The analysis identified a procurement type that increased the average duration of the procurement contract approval process by 50%. Frequency analysis revealed "anti-leaders" of approvals, through which up to 3 repeated approvals are passed. Losses of up to 30% of the total process time were identified.

What was done

Designed measures to reduce the number of errors leading to re-approvals.
Reduced wait time between process steps.
Optimized the procedure of working with comments to the negotiated agreements.


Results achieved

Duration of the process reduced by half.
Reduced process costs by 30%.
Production plan failures reduced to 0.