Description

The most successful procurement professionals develop strong total cost of ownership (TCO)behaviors. These professionals systematically take a TCO approach into account in their procurement decisions, use analytics and spreadsheet models to analyze suppliers,advise cross-functional teams on supplier selection, design decisions, and timing considerations based on TCO analysis, and search to identify innovative solutions to optimize total cost of ownership.

To do this you need to get to know the suppliers along with their strengths and weaknesses. You need to have an eye to supplier performance improvement, ensuring that both your company and the supplier work to improve service and costs according to set targets. When issues are identified, you work collaboratively with the supplier to see that they are resolved quickly and to the satisfaction of your client.

The selection of courses below, combined into the Analyzing Costs Using TCO track, is designed to address the above topics efficiently and comprehensively, allowing learners to immediately apply lessons learned to their work.

• Week 1: Selecting and Managing Total Cost of Ownership Projects
  • Understanding the TCO Process
  • Managing a TCO Project
  • Phase 1 of The TCO Process
  • Phase 2 of The TCO Process
  • Exploring Costs that Impact TCO
  • Overcoming Barriers to Data Collection

• Week 2: Preparing for TCO Analysis
  • Comparative TCO Analysis
  • Using the 3As to Model Costs
  • Landed Cost Analysis
  • Global Sourcing and Competitive Bid Analysis
  • Understanding Tradeoffs in Global Sourcing

• Week 3: “Should Cost” Modeling and Success Factors
  • Should Cost Analysis
  • Building Should Cost Models
  • Collecting and Building a Cost Database
  • Understanding Target Costing
  • Creating Win-Win Supplier Outcomes Using Should Cost Models

• By the end of this three-week program, you should be able to:
  • Evaluate projects that have the potential to yield significant savings to the company’s bottom line by conducting cost analysis
  • Identify and measure Total Cost of Ownership (TCO) components and their impact on TCO value
  • Identify TCO components relevant to a class of products or services
  • Structure a TCO calculation model for a given class of products or services
  • Understand basic financial principals involved in calculating TCO components

• What You’ll Learn
  • Learn why most successful procurement professionals develop strong total cost of ownership (TCO) behaviors.
  • Systematically take a TCO approach into account in your procurement decisions, use analytics and models to analyze suppliers, advise cross-functional teams on supplier selection, design decisions, and timing considerations based on TCO analysis, and search to identify innovative solutions to optimize total cost of ownership.
  • Learn how to get to know your suppliers along with their strengths and weaknesses.
  • You need to have an eye to supplier performance improvement, ensuring that both your company and the supplier work to improve service and costs according to set targets. When issues are then identified, you learn to work collaboratively with the supplier to see that they are resolved quickly and to the satisfaction of your customers and key stakeholders.