KEY PERFORMANCE INDICATORS IN IT PROCUREMENT

KEY PERFORMANCE INDICATORS IN
INDIRECT IT PROCUREMENT OPERATIONS
JUNE 2023
A comprehensive, yet simplified, look at KPI options in IT procurement and how they can
enable organisations to make informed decisions, enhance operational efficiency, drive
cost savings, and optimise resource utilisation.

KEY PERFORMANCE INDICATORS IN INDIRECT
IT PROCUREMENT OPERATIONS
WWW.MARKIT.EU 2 JUNE 2023
CONTENTS
INTRODUCTION 3
THE IMPORTANCE OF KPIs IN IT PROCUREMENT 4
TOP LINE KPIs FOR IT PROCUREMENT IN MULTINATIONALS 6
COST SAVINGS AND VALUE OPTIMISATION KPIs 12
TIME SAVING KPIs 14
SUSTAINABILITY 17
SUSTAINABILITY KPIs IN LOGISTICS 17
OTHER SUSTAINABILITY KPIs 19
RISK MANAGEMENT KPIs 22
WEIGHTING KPIs 24
USING ONLINE MARKETPLACES TO SATISFY IT PROCUREMENT KPIs 26
CAVEAT EMPTOR 28
REAL COST SAVING EXAMPLE FROM A MARKIT CLIENT 28
CONCLUSION 28

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INTRODUCTION
The objective of this report is to highlight the importance of KPIs in IT procurement and demonstrate
how they enable organisations to make informed decisions, enhance operational efficiency, drive cost
savings, and optimise resource utilisation. By employing well-defined KPIs, organisations can better
align their procurement strategies with business objectives, mitigate risks, and foster continuous im-
provement in the procurement process. It is almost impossible to define an exhaustive or precise list
of IT procurement KPIs. There are significant crossover impacts in numerous areas. For example, auto-
mating the IT procurement process not only reduces time spent on the procurement process steps but it
also speeds delivery which in turn means the resources and implemented in buying company faster and
therefore, theoretically increase company/employee performance or efficiency levels.
Nonetheless, in this report we attempt to segment the KPIs to a degree and, where relevant, add a com-
ment or outline Markit’s relationship with them based on our experience of helping hundreds of multina-
tionals save time and money on their IT hardware, accessory, and procurement service needs since 2003.
We are grateful to the procurement, IT, and digitalisation teams at our client companies for helping
inform our knowledge on which KPIs matter to multinationals across abroad spectrum of industries.
Of course, every company is unique and there is no industry-standard set of KPIs to ascribe to. At Markit,
our flexibility, transparency and data driven approach means we can usually provide data to input to cli-
ent KPIs and where we cannot (immediately) we often can customise our service or reporting to accom-
modate client needs.
It is worth adding that we encourage our clients, and all companies, to be transparent about their KPIs
for measuring IT procurement performance (Markit- or client-side). Transparency helps us clarify how we
can help our clients succeed, and it is fair to say that better results emerge when clients are open about
their KPIs.
IMPORTANT NOTE OF THANK YOU to George Bakker, Buyer Manager at Cabot
Cabot’s transparency and sharing of their KPIs and results at Markit Forum 2023
inspired us to think about creating this report and share more of the KPIs that we
know exist in the field of indirect IT procurement.

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THE IMPORTANCE OF KPIs IN IT PROCUREMENT
In today’s rapidly evolving technological landscape, organisations heavily rely on efficient and effective
IT procurement practices to acquire the necessary technology resources. IT procurement encompass-
es the process of sourcing, selecting, and acquiring IT goods and services to meet business needs. To
ensure success and maximise value in this crucial area, organisations increasingly recognise the signif-
icance of Key Performance Indicators (KPIs) as essential tools for monitoring, measuring, and improving
IT procurement operations.
Enhancing Decision-Making
KPIs provide organisations with tangible data and metrics that enable informed decision-making. By
tracking and analysing relevant KPIs, such as vendor performance, cost savings, or cycle time, procure-
ment professionals can assess supplier capabilities, negotiate contracts, and make strategic sourcing
decisions. KPIs also help identify areas of improvement, set realistic targets, and monitor progress to-
ward achieving procurement goals.
Driving Operational Efficiency
Efficient IT procurement processes are crucial for timely delivery of technology resources e.g., IT hard-
ware and accessories. KPIs enable organisations to identify bottlenecks, streamline workflows, and
optimise process efficiency. By monitoring KPIs such as requisition-to-order cycle time, order accuracy,
or contract compliance, organisations can eliminate redundant activities, reduce delays, and improve
overall procurement performance.
Cost Savings and Value Optimisation
KPIs play a vital role in controlling costs and optimising the value derived from IT procurement activities.
Tracking cost-related KPIs, such as total cost of ownership, cost avoidance, or return on investment,
enables organisations to identify opportunities for savings, negotiate better pricing, and assess the bud-
getary impact of procurement decisions. Additionally, KPIs related to supplier performance and quality
ensure that investments deliver the expected value and meet organisational requirements.

Mitigating Risks
IT procurement involves inherent risks, such as supply chain disruptions, supplier non-compliance, or
data security breaches. KPIs focused on risk management, such as supplier risk assessment, delivery
reliability, or data protection, provide organisations with insights to identify and mitigate potential risks.
Proactively monitoring these KPIs enables organisations to establish contingency plans, strengthen sup-
plier relationships, and ensure business continuity.
Resource Utilisation and Sustainability
Effective IT procurement involves optimising resource utilisation and promoting sustainability. KPIs
related to resource efficiency, such as energy consumption, waste reduction, or supplier sustainability
performance, help organisations assess the environmental impact of procurement decisions. By incor-
porating sustainability focused KPIs, organisations can make environmentally conscious choices, reduce
waste generation, and contribute to their corporate social responsibility objectives.
In conclusion, KPIs play a critical role in driving success and value in IT procurement. By implementing a
well-defined set of KPIs, organisations can monitor performance, identify areas for improvement, and
align their procurement strategies with business goals. KPIs enable informed decision-making, drive
operational efficiency, deliver cost savings, mitigate risks, and promote resource optimisation and sus-
tainability. Embracing KPIs as a core component of IT procurement practices empowers organisations to
make data-driven decisions, enhance their competitive advantage, and achieve procurement excellence
in today’s dynamic and technology-driven business landscape.
Danfoss is an important Markit client who was shortlisted in the World Procurement
Awards for the impressive savings (15% and fast rollout to 24 countries of the
consolidation project implemented with Markit. Read more here

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TOP LINE KPIs FOR IT PROCUREMENT IN MULTINATIONALS
The key performance indicators (KPIs) for IT procurement in a multinational organisation can vary de-
pending on specific goals, priorities, and industry. However, here is a list of commonly tracked KPIs
(based on our insights to Markit clients’ metrics and accepted industry norms) that can provide insights
into the effectiveness and efficiency of IT procurement:
Purchase Order Cycle Time Reduction
Track the progress made in reducing the overall time it takes to process purchase orders, from initia-
tion to completion. By continuously monitoring and striving for cycle time reduction, organisations can
streamline their procurement processes, minimise delays, and improve efficiency. Shorter cycle times
result in faster order processing, improved responsiveness to business needs, and ultimately, increase
operational agility.
Requisition to Purchase Order Time
This metric measures the time taken to convert a requisition into a purchase order. It includes the entire
process from the submission of a requisition by a requester to the generation and approval of the pur-
chase order. By analysing this KPI, organisations can identify bottlenecks and streamline the approval
process, reducing delays in converting requisitions into actionable purchase orders. Reducing this time
leads to quicker procurement cycles, faster delivery of goods or services, and improved overall procure-
ment efficiency.
At Markit this can be reduced to zero by creating pre-approved catalogues or punchout integration.
Vendor Onboarding Time
This KPI evaluates the speed and efficiency of onboarding new vendors into the procurement system.
Efficient onboarding ensures that new vendors are quickly integrated into the procurement ecosystem,
allowing organisations to leverage new partnerships and access a wider range of suppliers. By reducing
the time it takes to onboard vendors, organisations can establish productive relationships more rapidly,
enhance supply chain agility, and potentially achieve cost savings through increased competition among
vendors.
Markit dedicated client support team of over 50 people (2023) ensure personalised onboarding is han-
dled promptly. Typically, a multinational client is fully up and running in 4-8 weeks.

E-Procurement Adoption Rate
This metric tracks the extent of adoption and utilisation of electronic procurement systems and process-
es. Higher adoption rates indicate a higher proportion of procurement activities being conducted elec-
tronically, reducing manual intervention, and saving time. E-procurement systems provide streamlined
workflows, automated approvals, electronic documentation, and real-time visibility into procurement
activities. By leveraging e-procurement tools, organisations can significantly reduce the time spent on
manual paperwork, improve data accuracy, streamline communication with suppliers, and expedite the
overall procurement process.
Procurement Automation Rate
Measure the percentage of procurement activities that are automated within the procurement function.
Automation plays a crucial role in saving time by eliminating manual, repetitive tasks and streamlining
processes. Higher automation rates indicate a reduced reliance on manual intervention, resulting in
faster order processing, improved accuracy, and increased productivity for procurement professionals.
Automated procurement processes include requisition management, purchase order generation, invoice
processing, and supplier performance evaluation. By automating these tasks, organisations can free up
valuable time, reduce errors, and focus on strategic activities.
“Everything” is automated at Markit with the option for manual overrides, so when the client has auto-
mated from their side we are, in almost every case, able to integrate with their system to ensure a fully
automated process if required.
RFx Cycle Time
This KPI measures the time taken to complete the entire RFx (Request for Proposal, Request for Quo-
tation, or Request for Information) process. RFx processes involve sourcing activities such as soliciting
bids, evaluating proposals, and selecting suppliers. By monitoring this metric, organisations can identify
areas of improvement in the RFx process, such as shortening response times, streamlining evaluation
procedures, and optimising communication with suppliers. Reducing RFx cycle time enables quicker
decision-making, faster supplier selection, and accelerated procurement timelines.
When using the Markit marketplace to compare real-time offers from up to 350 IT distributors the
process takes seconds or just a few minutes.

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Contract Negotiation Time
This metric evaluates the time taken to negotiate and finalise contracts with suppliers. Efficient contract
negotiation processes are crucial in saving time and ensuring that contractual agreements align with
business objectives. Delays in contract negotiation can lead to project delays or missed opportunities.
By monitoring contract negotiation time, organisations can identify areas for improvement, such as
streamlining the negotiation process, standardising contract templates, and improving communication
with legal and procurement teams. Decreasing the time spent on contract negotiation leads to faster
contract finalisation, reduced procurement cycle time, and improved supplier relationships.
Purchase Order Approval Time
Track the time taken for purchase orders to be approved at various levels within the organisation. Pur-
chase order approval processes involve multiple stakeholders, including requesters, budget approvers,
and procurement teams. Delays in purchase order approvals can disrupt the procurement process,
impact supplier relationships, and result in delayed delivery of goods or services. By monitoring purchase
order approval time, organisations can identify bottlenecks and implement strategies to streamline the
approval workflow. This includes setting clear approval hierarchies, implementing automated approval
systems, and improving communication channels. Quicker purchase order approvals lead to faster pro-
curement cycles and improved operational efficiency.
Supplier Evaluation and Selection Time
This metric measures the duration required to evaluate and select suppliers during the procurement pro-
cess. Supplier evaluation and selection are critical steps in ensuring that the right suppliers are chosen
to meet organisational needs. Lengthy evaluation and selection processes can prolong procurement cy-
cles and delay project timelines. By monitoring supplier evaluation and selection time, organisations can
identify opportunities to streamline the supplier qualification process, reduce paperwork, and optimise
supplier evaluation criteria. Decreasing the time spent on supplier evaluation and selection leads to fast-
er engagement with qualified suppliers, quicker decision-making, and accelerated procurement cycles.
Once Markit is approved as a supplier, clients have access to offers from over 350 of the world’s largest
IT distributors. This is why many clients choose to consolidate all or most of the IT hardware and acces-
sory buying into Markit.

Procurement Process Standardisation
This KPI assesses the degree of standardisation and streamlining of procurement processes to reduce
time spent on manual or redundant tasks. Standardising procurement processes involves creating clear
and well-defined workflows, templates, and guidelines. By streamlining and standardising the procure-
ment process, organisations eliminate unnecessary steps, reduce errors, and save time. Standardisation
ensures consistency in procurement activities, simplifies decision-making, and facilitates cross-func-
tional collaboration. It also enables organisations to leverage best practices, optimise resource alloca-
tion, and streamline communication among procurement teams, requesters, and suppliers. Overall,
procurement process standardisation leads to faster and more efficient procurement cycles.
Procurement Process Automation
Measure the level of automation in various stages of the procurement process, such as purchase requisi-
tion, vendor selection, purchase order generation, and invoice processing. By automating these process-
es, organisations can significantly reduce manual effort, eliminate paper-based tasks, and save time.
Automation streamlines workflows, enhances accuracy, and facilitates faster processing, resulting in
improved procurement efficiency and reduced cycle times.
All such processes are automated with the Markit marketplace.
Lead Time Reduction
This metric focuses on reducing the lead time associated with procuring IT goods and services. Lead time
refers to the time taken from initiating a purchase request to receiving the requested items. By analys-
ing and optimising lead time, organisations can identify areas of improvement, such as supplier selec-
tion, order processing, and logistics. Reducing lead time enables faster delivery of IT resources, minimis-
es operational disruptions, and improves overall IT service delivery.
The average order delivery time in 2022 to Markit clients across 40 countries was 3.9 days.
Reorder Cycle Time
This KPI tracks the time between successive reorders of IT products or services. By reducing the reor-
der cycle time, organisations can ensure timely replenishment of critical IT resources. Efficient reorder
processes, including automated inventory monitoring, proactive supplier communication, and optimised

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reorder points, help prevent stockouts, reduce emergency orders, and save valuable time in managing IT
procurement.
Fast delivery times, buffer stock options and transparent real-time stock levels ensure reordering is opti-
mised for Markit clients.
Procurement Process Efficiency
Assess the overall efficiency of the procurement process. This KPI considers factors such as resource
utilisation, elimination of bottlenecks, reduction of redundant activities, and streamlined workflows. By
continuously monitoring and improving procurement process efficiency, organisations can save time,
reduce costs, and enhance the agility of their IT procurement operations.
Supplier Performance Evaluation Time
This KPI measures the time taken to evaluate the performance of IT suppliers. Effective supplier perfor-
mance evaluation ensures that suppliers meet contractual obligations, deliver quality goods and ser-
vices, and maintain service levels. By streamlining the evaluation process, automating data collection,
and implementing efficient performance measurement methodologies, organisations can save time in
evaluating supplier performance and facilitate timely decision-making regarding supplier relationships.
Markit Net Promoter Score in 2022 was a world class 78.6%.
Demand Forecasting Accuracy
This metric evaluates the accuracy of IT demand forecasting. Accurate forecasting helps organisations
plan and procure IT resources effectively, avoiding stockouts or excess inventory. By improving demand
forecasting accuracy through advanced analytics, historical data analysis, and collaboration with stake-
holders, organisations can reduce the time spent on reactive procurement, optimise inventory levels,
and enhance overall supply chain efficiency.
Requisition Approval Time
Measure the time taken to approve purchase requisitions. Efficient requisition approval processes en-
sure timely processing of requests and enable prompt initiation of the procurement process. By stream-
lining approval workflows, implementing automated systems, and defining clear approval authorities,
organisations can reduce requisition approval time and accelerate the procurement cycle.

The Markit system provides all necessary data instantly – product specifications, price options, delivery
times etc. making it easier for approvers to make their decisions.
Supplier On-time Delivery
Track the percentage of IT orders delivered by suppliers on or before the agreed-upon delivery date.
Timely supplier deliveries are crucial for meeting project timelines and operational requirements. By
monitoring supplier on-time delivery, organisations can identify reliable suppliers, mitigate supply chain
disruptions, and reduce the time spent on resolving delivery-related issues.
Ontime delivery in 2022, a challenging year for all supply chains, was 92% at Markit. Most orders that
were not “on time” were delivered in the following 24-48 hours (about 2 days).
Contract Renewal Time
This KPI measures the time taken to renew IT contracts with suppliers. Timely contract renewals ensure
continuity of services, avoid gaps in supply, and maintain favourable terms and conditions. By estab-
lishing efficient contract renewal processes, including timely notifications, automated reminders, and
proactive negotiation strategies, organisations can reduce the time spent on contract renewal activities
and minimise potential disruptions to IT operations.
Procurement Process Documentation Time
This metric evaluates the time taken to document various procurement activities, including purchase
requisitions, purchase orders, contracts, and supplier performance reports. Efficient documentation
processes ensure accurate record-keeping, compliance with regulations, and effective communication
with stakeholders. By implementing standardised documentation templates, leveraging digital docu-
ment management systems, and streamlining approval and review processes, organisations can reduce
the time spent on documentation and enhance overall procurement efficiency.
Markit clients have made measurable and provable saving in time and money.
A selection of Markit client success stories is available here.

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COST SAVINGS AND VALUE OPTIMISATION KPIs
Tracking cost-related KPIs, such as total cost of ownership, cost avoidance, or return on investment,
enables organisations to identify opportunities for savings, negotiate better pricing, and assess the bud-
getary impact of procurement decisions. Additionally, KPIs related to supplier performance and quality
ensure that investments deliver the expected value and meet organisational requirements.
Cost Avoidance
Measure the savings achieved by avoiding unnecessary costs, such as eliminating redundant software
licenses or renegotiating contracts to reduce pricing. It focuses on identifying opportunities to prevent
expenditures upfront.
Cost Reduction
Track the actual reduction in costs achieved through strategies like consolidating vendors, leveraging
economies of scale, or optimising hardware and software procurement. It reflects the tangible savings
realised by the organisation.
In 2022, Markit clients saved an average 10.3% against market average prices.
Supplier Performance
Assess the performance of IT suppliers and vendors based on factors like on-time delivery, adherence
to service level agreements, and quality of products or services. It ensures that procurement decisions
result in value-added relationships with reliable suppliers.
Markit’s NPS (Net Promoter Score) in 2022 was 78.6%
Contract Compliance
This KPI measures the extent to which IT procurement activities align with contractual terms and con-
ditions. It ensures that the organisation is maximising the benefits outlined in contracts, such as dis-
counts, rebates, or service credits.

Total Cost of Ownership (TCO)
TCO measures the entire cost associated with an IT asset or service over its entire lifecycle, including
acquisition, deployment, maintenance, and disposal costs. This KPI enables organisations to evaluate the
true cost-effectiveness of their procurement decisions.
Return on Investment (ROI)
ROI assesses the financial benefits gained from IT procurement initiatives relative to the investment
made. It measures the value generated by the acquired IT assets or services, considering both cost sav-
ings and revenue generation potential.
Spend Analysis
This KPI involves analysing IT procurement spend to identify cost-saving opportunities, such as bulk
purchasing, negotiating volume discounts, or identifying areas of overspending. It helps organisations
optimise their spending patterns and achieve cost efficiency.
Markit account managers hold regular client review meetings. Our goal is to save our clients time and
money and we are constantly looking for ways to achieve that.
Supplier Diversity
Supplier diversity measures the organisation’s efforts to engage a diverse range of suppliers, such as
minority-owned, women-owned, or small businesses. It promotes competition, fosters innovation, and
contributes to social responsibility while potentially leading to cost savings.
Process Efficiency
Focus on streamlining IT procurement processes to eliminate bottlenecks, reduce cycle times, and
increase overall efficiency. It tracks metrics like the time taken to process purchase requests, vendor
selection, and contract negotiations.
Stakeholder Satisfaction
This metric gauges the satisfaction levels of internal stakeholders, such as end-users or IT teams, with
the procurement process. It assesses factors like user experience, timely delivery, quality of IT assets or
services, and the overall value perceived by stakeholders. Ensuring stakeholder satisfaction is crucial for
maximising the benefits derived from IT procurement while minimising potential disruptions.

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TIME SAVING KPIs
Monitoring and improving the timesaving KPIs listed below allow multinational organisations to optimise
their IT procurement processes, minimise delays, and achieve greater efficiency in acquiring and man-
aging IT resources. Specifically, they help organisations identify bottlenecks, improve process efficiency,
and reduce procurement cycle times.
Purchase Order Cycle Time Reduction
This KPI focuses on tracking the progress made in reducing the overall time it takes to process purchase
orders, from initiation to completion. By continuously monitoring and striving for cycle time reduction,
organisations can streamline their procurement processes, minimise delays, and improve efficiency.
Shorter cycle times result in faster order processing, improved responsiveness to business needs, and
ultimately, increase operational agility.
Markit’s clients can significantly reduce purchase order cycle times, sometimes by up to 90%.
Requisition to Purchase Order Time
This metric measures the time taken to convert a requisition into a purchase order. By analysing this KPI,
organisations can identify bottlenecks and streamline the approval process, reducing delays in convert-
ing requisitions into actionable purchase orders. Reducing this time leads to quicker procurement cycles,
faster delivery of goods or services, and improved overall procurement efficiency.
Unlocking Employee Time to Create Measurable New Value Opportunities
Markit outlines a blueprint and methodology to measure, value and optimise
sourcing and purchasing process times in indirect IT P2P processes. It shows how
almost every international company can reduce its current or future IT hardware &
accessory sourcing and purchasing process times by significant amounts.
FREE DOWNLOAD available from the Procurement Leaders marketplace.
Markit client, Greentube, detailed how they significantly increased user satisfaction in their
IT procurement success story: How user-centric procurement can drive innovation and
influence employee satisfaction

Vendor Onboarding Time
Evaluate the speed and efficiency of onboarding new vendors into the procurement system. By reduc-
ing the time it takes to onboard vendors, organisations can quickly establish partnerships and access
new suppliers, leading to increased competition and potential cost savings. Efficient vendor onboarding
processes streamline communication, data exchange, and contract negotiations, ensuring faster inte-
gration of new vendors into the procurement ecosystem.
Once agreements have been made, Markit clients are typically onboarded in just 2-4 weeks.
E-Procurement Adoption Rate
This metric tracks the extent of adoption and utilisation of electronic procurement systems and process-
es. Higher adoption rates indicate a higher proportion of procurement activities being conducted elec-
tronically, reducing manual intervention, and saving time. E-procurement systems enable streamlined
workflows, automated approvals, electronic documentation, and real-time visibility, resulting in acceler-
ated procurement cycles and reduced administrative overhead.
Procurement Automation Rate
This KPI measures the percentage of procurement activities that are automated. Automation plays a
crucial role in saving time by eliminating manual, repetitive tasks and streamlining processes. Higher
automation rates indicate a reduced reliance on manual intervention, resulting in faster order process-
ing, improved accuracy, and increased productivity for procurement professionals.
60% of orders placed with Markit are fully automated and “touchless”.
RFx Cycle Time
This KPI measures the time taken to complete the entire RFx (Request for Proposal, Request for Quo-
tation, or Request for Information) process. By monitoring this metric, organisations can identify areas
of improvement in the RFx process, such as shortening response times, streamlining evaluation pro-
cedures, and optimising communication with suppliers. Reducing RFx cycle time enables quicker deci-
sion-making, faster supplier selection, and accelerated procurement timelines.
The Markit marketplace displays both prices and stock availability in real time. Comparisons can be
made in seconds.

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Contract Negotiation Time
This metric evaluates the time taken to negotiate and finalise contracts with suppliers. Organisations
strive to minimise contract negotiation time to expedite the procurement process. Streamlining contract
negotiations, including clear communication, standardised templates, and efficient collaboration be-
tween stakeholders, enables faster contract finalisation, reducing overall procurement cycle time.
Markit-client negotiations are usually expedited promptly. Partly because Markit has 20 years of experi-
ence serving the varied needs of multinationals in more than 40 countries and is therefore well prepared
with necessary data and documentation.
Purchase Order Approval Time
This KPI tracks the time taken for purchase orders to be approved at various levels within the organisa-
tion. Organisations aim to minimise purchase order approval time to expedite the procurement process
and avoid delays in fulfilling business requirements. Efficient approval workflows, automated notifica-
tions, and clearly defined approval hierarchies facilitate quicker purchase order approvals and enable
faster procurement cycles.
Client-centric customisations of the Markit marketplace to define user roles, budget limits and favourite
lists offer the opportunity for instant PO approval if desired.
Supplier Evaluation and Selection Time
This metric measures the duration required to evaluate and select suppliers during the procurement
process. By analysing supplier evaluation and selection time, organisations can identify opportunities
to streamline the supplier qualification process, reduce paperwork, and optimise supplier evaluation
criteria. Decreasing the time spent on supplier evaluation and selection leads to faster engagement with
qualified suppliers and quicker procurement decision-making.
Markit operates as a single supplier under the marketplace-as-a-supplier model. The client has one SLA
that gives them transparent access to the stock of over 350 IT distributors globally. Supplier evaluation
is therefore “done” once only. A growing number of companies are choosing to consolidate all their IT
purchasing into one supplier – Markit.

Procurement Process Standardisation
This KPI assesses the degree of standardisation and streamlining of procurement processes to reduce
time spent on manual or redundant tasks. Standardising procurement processes involves creating clear
and well-defined workflows, templates, and guidelines. By streamlining and standardising the procure-
ment process.
SUSTAINABILITY
Markit is working hard on sustainable procurement issues. Evidence of such can be found in our Com-
munication of Progress as Markit is an active participant of the United Nations Global Compact.
To find out the latest information please contact:
Markit Sustainability Manager, Olga Paluga olga.paluga@markit.eu
SUSTAINABILITY KPIs IN LOGISTICS
By incorporating logistics-related sustainability KPIs into IT procurement processes, organisations can
prioritise environmentally friendly transportation methods, reduce carbon emissions, minimise packag-
ing waste, and foster sustainable practices throughout the supply chain.
Green Logistics Score
This KPI measures the overall sustainability performance of logistics providers used in IT procurement. It
evaluates factors such as emissions reduction strategies, use of alternative fuels, efficient route plan-
ning, and adoption of environmentally friendly transportation methods.
Carbon Footprint of Transportation
This metric quantifies the carbon dioxide (CO2) emissions generated by transportation activities asso-
ciated with IT procurement. It encourages organisations to select logistics partners with low-emission
vehicles, optimise delivery routes, and leverage greener transportation options to reduce the carbon
footprint.

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Fuel Efficiency
This KPI assesses the fuel efficiency of transportation vehicles used for IT procurement, such as trucks
or vans. It focuses on reducing fuel consumption, promoting the use of hybrid or electric vehicles, and
implementing driver training programs to optimise fuel efficiency and minimise emissions.
Packaging Optimisation
This metric evaluates the efforts to minimise packaging materials and waste generated during transpor-
tation. It encourages the use of eco-friendly packaging materials, right-sising packaging to reduce space
and weight, and implementing recycling or reuse programs to minimise the environmental impact of
packaging.
Markit is taking a stand on IT device and accessory packaging and is working as part of the Packaging
Action Team of the Sustainable Procurement Leadership Council. We are playing an active role in contrib-
uting IT industry related research and opinions.
Last-Mile Delivery Efficiency
This KPI measures the efficiency of last-mile delivery operations in IT procurement. It focuses on optimis-
ing delivery routes, reducing idle time, and increasing delivery density to minimise the distance travelled
and associated emissions.
Reverse Logistics
This metric assesses the effectiveness of reverse logistics processes in IT procurement, including prod-
uct returns and end-of-life disposal. It encourages the implementation of proper recycling and disposal
channels for electronic waste, promoting circular economy practices and reducing environmental im-
pacts.
Modal Shift
This KPI tracks the proportion of transportation activities that have shifted from higher-emission modes
(such as air freight or road transport) to lower-emission alternatives (such as rail or sea transport). It en-
courages organisations to prioritise greener modes of transportation to reduce emissions and improve
sustainability in logistics.

Supplier Sustainability in Logistics
This metric evaluates the sustainability performance of logistics service providers and carriers used in IT
procurement. It assesses factors such as emissions reduction strategies, environmental certifications,
adherence to sustainability standards, and commitment to ethical practices in logistics operations.
Delivery Accuracy
This KPI measures the accuracy and reliability of deliveries in IT procurement. It focuses on reducing
delivery errors, missed deliveries, and subsequent re-deliveries, which contribute to unnecessary trans-
portation and associated emissions.
Supply Chain Collaboration
This metric assesses the level of collaboration and coordination among stakeholders within the IT pro-
curement supply chain. It encourages information sharing, joint planning, and collaboration on sustain-
ability initiatives, such as optimising transportation routes, consolidating shipments, and implementing
shared delivery networks.
OTHER SUSTAINABILITY KPIs
By incorporating these sustainability related KPIs into IT procurement processes, organisations can pro-
actively manage their environmental impact, support sustainable practices, and contribute to broader
sustainability goals. These KPIs help track progress, identify areas for improvement, and drive continu-
ous sustainability enhancements throughout the IT procurement lifecycle.
Energy Efficiency
This KPI measures the energy efficiency of IT products and equipment. It assesses factors such as energy
consumption during operation, standby power usage, and compliance with energy efficiency standards.
Higher energy efficiency contributes to reduced environmental impact and supports sustainability goals.
The Markit marketplace has numerous eco-filters e.g., TCO, Energy Star etc.
Read the Markit Case Study Recognised by the Sustainable Purchasing Leaders Council.

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E-Waste Management
This metric tracks the organisation’s efforts in managing electronic waste generated from IT procure-
ment. It includes the percentage of e-waste properly recycled or disposed of, adoption of take-back
programs, and compliance with e-waste regulations. Effective e-waste management minimises environ-
mental harm and promotes circular economy principles.
Sustainable Packaging
This KPI evaluates the sustainability of packaging materials used in IT products. It measures the percent-
age of packaging that is recyclable, made from renewable materials, or designed for reduced waste. Opt-
ing for sustainable packaging reduces resource consumption, minimises waste generation, and supports
responsible sourcing.
Markit is taking a stand on IT device and accessory packaging and is working as part of the Packaging
Action Team of the Sustainable Procurement Leadership Council. We are playing an active role by con-
tributing IT industry related research and opinions.
Greenhouse Gas Emissions
This metric quantifies the carbon footprint associated with IT procurement activities. It includes tracking
and reporting Scope 1, Scope 2, and Scope 3 greenhouse gas emissions, assessing the environmental
impact of the organisation’s IT infrastructure, and promoting strategies to reduce emissions.
Life Cycle Assessment
This KPI evaluates the environmental impact of IT products throughout their life cycle, from raw mate-
rial extraction to disposal. It assesses factors such as carbon emissions, resource depletion, and water
usage. Conducting life cycle assessments helps identify opportunities for improvement and supports
sustainable product selection.
Renewable Energy Adoption
This metric measures the organisation’s commitment to using renewable energy sources to power IT
infrastructure. It includes tracking the percentage of renewable energy consumed, the installation of on-
site renewable energy systems, and participation in renewable energy purchasing programs. Increased
adoption of renewable energy contributes to decarbonisation and sustainable energy use.
Markit’s marketplace is powered by green energy, helped clients with their Scope 3 emission targets.

Toxic Materials Reduction
This KPI assesses efforts to minimise the use of hazardous or toxic materials in IT products. It includes
monitoring compliance with regulations such as Restriction of Hazardous Substances (RoHS), reducing
the presence of harmful substances like lead or mercury, and promoting environmentally friendly alter-
natives.
Supplier Sustainability Assessment
This metric evaluates the sustainability performance of IT suppliers. It assesses factors such as their en-
vironmental policies, social responsibility practices, and adherence to sustainability standards. Conduct-
ing supplier sustainability assessments encourages responsible sourcing and supports partnerships with
environmentally and socially conscious suppliers.
Green IT Initiatives
This KPI measures the implementation of green IT practices within the organisation. It includes the adop-
tion of energy-efficient hardware, virtualisation, remote work solutions, and data center optimisation
strategies. Green IT initiatives promote resource efficiency, reduce energy consumption, and minimise
environmental impact.
Stakeholder Engagement
This metric evaluates the organisation’s engagement with stakeholders regarding sustainable IT pro-
curement practices. It includes tracking initiatives such as employee training on sustainable IT practices,
supplier engagement programs, and collaboration with industry partners to drive sustainability efforts in
IT procurement.

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RISK MANAGEMENT KPIs
By tracking and monitoring the following risk focused KPIs, organisations can identify potential risks,
take proactive measures to mitigate them, and ensure a more secure and resilient IT procurement
process. It is important to customise and prioritise these KPIs based on the specific risk profiles and
requirements of the organisation.
Supplier Risk Assessment Score
This KPI measures the overall risk level associated with each IT supplier. It considers factors such as
financial stability, reputation, compliance with regulations, and past performance. A higher risk assess-
ment score may indicate the need for increased due diligence or potential alternative sourcing strate-
gies.
Delivery Reliability
This metric tracks the percentage of on-time and complete deliveries from IT suppliers. It assesses the
supplier’s ability to meet delivery commitments, ensuring that critical IT resources are available as
planned and minimising disruptions in operations.
Contract Compliance
This KPI measures the extent to which IT suppliers comply with the terms and conditions outlined in
procurement contracts. It includes factors such as adhering to quality standards, fulfilling service level
agreements, and meeting regulatory requirements.
Data Protection and Security
This metric evaluates the effectiveness of IT suppliers’ data protection and security measures. It assess-
es factors such as adherence to data protection regulations, implementation of robust cybersecurity
protocols, and compliance with industry standards for safeguarding sensitive information.
Markit takes data security very seriously. Please contact us for further details.

Business Continuity Planning
This KPI assesses the level of preparedness of IT suppliers in ensuring business continuity during unfore-
seen events or disruptions. It includes evaluating their contingency plans, disaster recovery capabilities,
and ability to maintain service levels under challenging circumstances.
Vendor Dependency
This metric measures the level of dependency on specific IT vendors. It assesses the potential risks as-
sociated with over-reliance on a single supplier, such as supply chain vulnerabilities, lack of competitive
alternatives, or potential disruptions caused by supplier instability.
Change Management Effectiveness
This KPI evaluates how efficiently IT suppliers manage and communicate changes to products, services,
or processes. It includes assessing the impact of changes on operations, evaluating the effectiveness of
change management procedures, and monitoring the successful implementation of changes.
Supplier Audit Findings
This metric tracks the number and severity of audit findings related to IT suppliers. It assesses the re-
sults of supplier audits, including non-compliance with regulations, quality issues, or other identified
risks. Monitoring and addressing audit findings help mitigate potential risks and ensure supplier perfor-
mance.
Escalation and Issue Resolution Time
This KPI measures the time taken to escalate and resolve critical issues with IT suppliers. It evaluates the
effectiveness of communication channels, responsiveness of suppliers, and the ability to address issues
promptly to minimise their impact on operations.
Markit RMA count is less than 0.02%. Over 50 client support specialists ensure that issues are dealt with
as fast as possible.
Supplier Continuity Planning
This metric assesses IT suppliers’ plans and strategies to ensure their own business continuity. It in-
cludes evaluating their financial stability, risk management practices, and contingency plans to mitigate
potential disruptions that could impact the delivery of IT products or services.
Markit has robust business continuity plans. Please contact us for further details.

JUNE 2023
WWW.MARKIT.EU 24
WEIGHTING KPIs
Whichever KPIs are right for your company one thing is certain – not all KPIs have equal importance and
therefore some kind of weighting or score could be attached to each KPI if using the results as a way of
evaluating suppliers.
Rather than propose various weighting options, here is an anonymised example from a Markit client in
the electronics manufacturing industry.
Standard payment terms are Net 90 days 10%
Overall Pricing of Items Purchased in Quarter Compared with spot Price Quotes from other
Capable Vendors
5%
Overall favourable contract terms; long term agreement in place and favourable to (company
name); minimised risk in contract
10%
Volume Discounts in place; (company name) receives special discounts or favourable terms 5%
30%
The duration of time from when an order is acknowledged by the vendor to when it is shipped
or accepted by the freight forwarder.
5%
Average time taken to respond to emails with purchasing (buyer or assistant buyer) 5%
Quality of communication, especially emails, with purchasing 5%
The flexibility of the vendor to accommodate business requests to the best of their ability 10%
Level of Shipping/Freight issues during the quarter 5%
20%

Overall quality issues / level of quality in the past quarter 5%
The supplier continues to have good market share of products or levels of service 5%
Supplier demonstrates a knowledge of market data and/or best practices about level of tech-
nology with the marketplace
7%
Supplier has programs in place or demonstrates good level of continuous improvement 3%
20%
Stakeholder / Operations issues handled in professional manner; supplier is proactive 8%
Stakeholders receive timely attention and responses to emails 3%
Pricing, terms & conditions experienced day to day are as per the contract 4%
SOWs are comprehensive as proposed; Work is performed per the SOW and/or quotations/pro-
posals are accurate
5%
20%

JUNE 2023
WWW.MARKIT.EU 26
USING ONLINE MARKETPLACES TO SATISFY
IT PROCUREMENT KPIs
Markit is the largest IT marketplace in the world, with over 5 million unique SKUs, real time transparent
pricing and we supply hundreds of multinationals across 6 continents. So, naturally, we will take this
opportunity to speak about marketplaces in general and how they can help with meeting KPI targets.
Cost Savings
Online marketplaces often offer competitive pricing due to increased transparency and ease of compar-
ison. Organisations can leverage this competitive environment to drive cost savings in IT procurement.
By comparing prices from different sellers, accessing bulk discounts, or taking advantage of promotional
offers, organisations can achieve cost efficiencies and meet cost-saving KPIs.
Supplier Selection and Evaluation
Online marketplaces provide access to a wide range of suppliers, allowing organisations to evaluate and
select vendors based on specific criteria. KPIs related to supplier performance, such as ratings, reviews,
and past customer experiences, can be considered when making purchasing decisions. The ability to as-
sess suppliers based on their reputation, delivery reliability, and product quality enhances the evaluation
process and supports the selection of reliable and reputable vendors.
Streamlined Procurement Process
Online marketplaces offer streamlined procurement processes, reducing administrative burdens and
cycle times. Through efficient search functions, filter options, and user-friendly interfaces, organisations
can quickly identify and compare IT products, place orders, and manage transactions. This streamlining
of the procurement process helps achieve KPIs related to cycle time, order accuracy, and overall opera-
tional efficiency.
Transparency and Product Information
Online marketplaces provide comprehensive product information, including specifications, user reviews,
and ratings. This transparency allows organisations to make informed decisions, assess the suitability
of products for their specific needs, and meet KPIs related to product quality, functionality, and perfor-
mance.

Scalability and Flexibility
Online marketplaces offer scalability, enabling organisations to adapt procurement activities based on
fluctuating demand. Whether it is purchasing a single item or bulk orders, online marketplaces can ac-
commodate varying procurement needs. This flexibility allows organisations to meet scalability related
KPIs and adjust procurement volumes as required.
Enhanced Competition
Online marketplaces foster competition among sellers, driving continuous improvement in pricing,
quality, and service levels. Suppliers on these platforms strive to differentiate themselves by offering
competitive prices, providing superior customer service, and ensuring timely deliveries. This competitive
environment benefits organisations seeking to achieve KPIs related to supplier performance and cus-
tomer satisfaction.
Access to a Global Marketplace
Online platforms connect buyers with a global network of suppliers, expanding the potential vendor pool
beyond local or regional options. This access to a broader marketplace increases the likelihood of finding
specialised IT products or niche suppliers, enabling organisations to meet KPIs related to supplier diver-
sity, innovation, and access to unique solutions.
Order Tracking and Transparency
Online marketplaces typically provide order tracking functionalities, allowing organisations to monitor
the status and progress of their purchases. Real-time updates on order fulfilment, shipping, and delivery
help organisations meet KPIs related to order visibility, delivery reliability, and customer satisfaction.
Simplified Reordering
Online marketplaces often offer features for easy reordering of previously purchased items. This simpli-
fies the procurement process, especially for routine IT purchases or replenishment orders. By reducing
the time and effort required for repeat orders, organisations can improve procurement cycle time and
achieve operational efficiency KPIs.
Data Analytics and Insights
Many online marketplaces provide data analytics and reporting tools that allow organisations to track
spending patterns, identify trends, and gain insights into their IT procurement activities. These analytics
can support decision-making, identify areas for cost optimisation, and contribute to achieving KPIs relat-
ed to spend analysis, budget control, and strategic sourcing.

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WWW.MARKIT.EU 28
CAVEAT EMPTOR
While the Markit marketplace offers numerous, demonstrable benefits for IT procurement (read some
Markit client success stories here), it is important for organisations to assess the suitability of each
marketplace, consider the reliability of sellers, and ensure compliance with procurement policies and
standards. Regular evaluation and monitoring of vendor performance, product quality, and overall satis-
faction remain essential to meeting KPIs and achieving successful IT procurement outcomes.
REAL COST SAVING EXAMPLE FROM A MARKIT CLIENT
One multinational Markit client measured the costs associated with ordering IT hardware and accesso-
ries in different ways. Of course, each for each company the costs will be different but as a simple exam-
ple comparing pre-Markit to using Markit (with/without punchout integration and with/without auto-
mated invoice integration) the costs were:
Paper/manual order cost 95 EUR
Only research and order via phone/email 65 EUR
Using Markit 33 EUR
Using Markit + Punchout 26 EUR
Using Markit + Punchout + Invoice integration 16 EUR
CONCLUSION
At Markit we understand IT procurement KPIs and what is required to not only to deliver data to help our
clients measure them but, more importantly, to help drive better client results in a never-ending cycle of
optimisation. In 2022, Markit saved clients an average of 10.3% against market average prices and de-
livered a time saving of up to 90% on IT procurement processes. See the Markit Factsheet 2023 for more
information.
In this report you will discover the roles, values, and desirable characteristics of the
ideal marketplace to support indirect procurement savings, using the example of an IT
hardware and accessory marketplace to illustrate the key points. We reveal the most
important features, factors and considerations that can help CPOs, CTOs and IT buyers
in international companies make an informed choice about how to choose, and when
to use, IT marketplaces to save time and money on their growing indirect IT procure-
ment needs. Available free from the Procurement Leaders marketplace.

Follow Markit news and views on our blog, LinkedIn, Twitter & SlideShare
Copyright © 2023 Markit Holding AS
This report is made available under the Creative Commons Attribution-ShareAlike License.
TAKE THE CHASING
OUT OF IT PURCHASING
WWW.MARKIT.EU
MARKIT IS A GLOBALLY RECOGNISED IT
PROCUREMENT MARKETPLACE
Thousands of international companies across 6 continents are saving
considerable amounts of time and money by sourcing and buying
their IT hardware and accessories through Markit’s IT marketplace
and procurement solution.
Markit clients compare prices and delivery times in real time in our
marketplace of over 5 million unique IT products. In 2022, they saved
an average of 10.3 % on average market prices and thousands of
hours by using Markit to manage, centralize, and streamline their IT
purchasing.
Founded in Estonia in 2003, Markit is now working in 42 countries in
2023. In 2022, Markit’s revenue was 217.8 million euros.
If you would like to discuss your sustainable IT hardware and acces-
sory requirements, please contact:
Jon Kolasinski
Head of Countries, Markit
E-mail: jon.kolasinski@markit.eu
Markit has reached the World Procurement
Awards finals shortlist twice. We owe a huge
thank you to all our clients, partners, and
Markiteers who helped make our global
recognition possible.

KEY PERFORMANCE INDICATORS IN IT PROCUREMENT

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