EMM Definitions and Expectations
These are UUK standard Efficiency Measurement Model
Definitions & Expectations.
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Efficiency
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Effectiveness
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1.
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Total cost of procurement function as % of non pay spend
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Benchmark
=0.9%
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4.
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% of non pay spend actively influenced by procurement
function
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Benchmark
=90%
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2.
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%age of non pay spend channelled through collaborative
procurement arrangements
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Benchmark
=25%
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5.
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Annual procurement savings as % of non pay spend
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Benchmark
=3.5%
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3.
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% of orders placed electronically and via purchasing cards
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Benchmark
=90%
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6.
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% of professionally qualified procurement staff
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Benchmark
=66.7%
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BPI 1.
The procurement function is defined as the centralised
procurement team plus staff bedded out in faculties, schools and
departments who undertake procurement activity that would otherwise
have to be undertaken by the centralised procurement team.
This includes staff in, for example, IT and Estates engaged on
significant procurement activity that requires them to apply
procurement principles and practices over and above
project/contract management. This excludes local buyers who are
engaged on transactional purchasing.
Total costs include salary and overhead costs - HMT/OGC advice
is to double salary to arrive at a total cost figure including
salary, on-costs (NI, tax, pension) and support costs. Pro rata
costs of bedded out staff engaged on procurement should also be
included.
Non pay spend figure is that recorded in the HEFCE Efficiency
Measurement Model (EMM).
The aim should be to seek the optimum cost of the procurement
function as a percentage of Non Pay spend, in conjunction with BPIs
4 and 5. In other words, a balance needs to be struck between these
three BPIs.
- Best Practice Result: 0.9%
BPI 2.
Percentage of non pay spend which is channelled through a
collaborative procurement arrangement such as a national/regional
framework agreement, a collaborative contract such as a SRIF
research equipment collaborative contract or collaborative
agreements with or via other parties.
Spend through framework suppliers that can not be robustly
confirmed as "contract" (i.e. collaborative) spend should be
excluded. For example, catalogue items bought from a laboratory
supplier under a framework agreement would be included; supply of
bespoke laboratory equipment won in competition by the same
laboratory supplier would be excluded.
This percentage should increase over time.
- Best Practice Result: 25%
BPI 3.
Percentage of orders passed through an electronic Purchase To
Pay (P2P) system or via purchasing cards. The aim of this BPI is to
identify efficient procurement processes.
In accordance with EMM Guidelines, it should be assumed that
purchase card orders are the same as electronic orders in terms of
issue of the order electronically and electronic payment transfer.
Other elements of the P2P process, such as electronic receipting of
goods and electronic invoice authorisation, are calculated
separately.
The multipliers below are conversions of the value figures for
process efficiencies contained in the EMM Guidelines e.g. £6 (out
of a possible total of £44) for electronic GRNs = 0.14:
- Percentage of total volume of orders placed via
purchase card and electronic order (i.e. the combined figure) x
0.63;
- Percentage of total volume of orders with
electronic GRNs x 0.14;
- Percentage of total volume of orders with
electronic invoices x 0.23;
Add the above percentages together to get a total percentage
figure. This percentage should increase over time.
- Best Practice Result: 90%
BPI 4.
Percentage of non pay spend which is actively influenced by the
procurement function (as defined in BPI 1).
Actively influenced is defined as "controlled" (direct
management of the actual procurement), "directed" (via a framework
managed by the procurement function) and "delegated" (establishment
by the procurement function of robust processes, procedures,
guidance or advice against which the procurement is managed).
The percentage should be calculated by dividing the influenced
spend by the non pay spend figure in the EMM and multiplying by
100.
Whilst the aim should be to progressively increase this
percentage, a balance needs to be struck between this BPI and BPIs
1 and 5.
- Best Practice Result: 90%
BPI 5.
Annual procurement savings achieved as a percentage of non pay
spend. This should be the percentage calculated by the EMM (Savings
as % of non pay Spend).
Whilst the aim should be to progressively increase this
percentage, a balance needs to be struck between this BPI and BPIs
1 and 4.
- Best Practice Result: 3.5%
BPI 6.
Percentage of the procurement function (as defined in BPI 1) who
have passed CIPS at Graduate Diploma level (fully qualified), or
who hold an alternative graduate level qualification that includes
procurement (fully qualified) or who have passed Foundation level
for one of the above (part qualified). For example, in a
procurement function of 3, with 1 fully qualified, 1 part qualified
and 1 unqualified, the percentage would be 50%.
This percentage should increase over time.
- Best Practice Result: 66.6%