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Unpacking Best Value: Understanding and Embracing Value Based Approaches for Procurement

Published: 19 May 2015 Average Rating: unrated Print
 

Author: Kate Vitasek, Todd Snelgrove, Dawn Evans, Wendy Tate, Bonnie Keith, and Sarah Holliman

Probably no other topic creates as much apprehension between two companies as trying to determine a fair price. The conventional procurement process pits buyers and sellers on opposite sides of the table. Classical negotiations training uses tradeoffs and concessions as tactics in order to get the best possible price (or preserve as much
margin as possible if you are a supplier). A win for the supplier means a loss for the buyer. The result? A zero sum game. A mindset where the parties fight over taking bigger slices of the pie instead of combining talents to make a bigger pie.

Move beyond price and truly understand the total cost of ownership (TCO) and associated hidden risks in order to determine the Best Value for the goods or services they buy and use.

 

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