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Using the Purchasing Chessboard

In: The Purchasing Chessboard

Author

Listed:
  • Christian Schuh

    (A.T. Kearney Ges.m.b.H.)

  • Joseph L. Raudabaugh

    (A.T. Kearney Inc.)

  • Robert Kromoser

    (A.T. Kearney Ges.m.b.H.)

  • Michael F. Strohmer

    (A.T. Kearney Ges.m.b.H.)

  • Alenka Triplat

    (A.T. Kearney Ges.m.b.H.)

Abstract

The Purchasing Chessboard is used to assign strategies and methods for cutting costs and increasing the value of specific spend. The first step is to find an appropriate classification for a given spend. For example, if a steel producer is planning to invest in a new coking plant, there are (roughly speaking) three levels at which an order can be placed: Plant: The entire coking plant is contracted out to a single turnkey supplier Process plant: The coking plant is divided into the coking plant proper and the gas treatment section, with contracts drawn up for each part Components: The coking plant is broken down into several parts — the coke-oven batteries, coal preparation and screening, oven machinery, chimneys, coal tower, and quenching towers, with separate contracts for each Note that there is no right or wrong in this scenario. The choice of structure largely depends on the capabilities of the company. Considering several strategies simultaneously allows the greatest possible transparency in weighing the pros and cons of bundling or separation.

Suggested Citation

  • Christian Schuh & Joseph L. Raudabaugh & Robert Kromoser & Michael F. Strohmer & Alenka Triplat, 2012. "Using the Purchasing Chessboard," Springer Books, in: The Purchasing Chessboard, edition 0, chapter 3, pages 35-52, Springer.
    • Handle: RePEc:spr:sprchp:978-1-4614-2221-1_3
    DOI: 10.1007/978-1-4614-2221-1_3
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