Reducing Total Cost - The Real Value of the TCO Model

INTERMEDIATE

Reducing Total Cost 

Select and deploy tools to scale and minimise the total cost of ownership.

The workshop explores how to achieve lower costs by employing the principle of total cost of ownership.  Price is a key driver in the evaluation of offers.  Explore other factors organisations need to dimension in order to minimise total cost.

1 DAY COURSE

LEARNING OUTCOMES

Our practical one-day course will equip you with the knowledge and tools to:

• Develop a total cost model and identify the components that are part of direct and indirect costs.
• Scale the total cost using available data and/or estimates to approximate total cost.
• Distinguish between cost levers and cost drivers to understand the factors that drive cost for a category or project.
• Develop a range of initiatives to reduce total cost and select the most appropriate options for any given category.
• Assess the impact of cost reduction initiatives to reduce total cost and capture the lessons learned.

BENEFITS OF ATTENDING

• Increased confidence applying practical methods to model total cost for a variety of categories, including direct and indirect costs associated with the acquisition, performance and close out of goods and services.
• More effective applying practical methods to generate a range of useful ideas to reduce total cost and assess the likely impact on the total cost profile.
• Lowers the likelihood the procurement process will make price focused choices that increase total cost.

COURSE OVERVIEW

1 - Reducing total cost

2 - The total cost principle; origin and basis

3 - Building a total cost model

4 - Validating cost estimates

5 - Identifying cost drivers

6 - Proposing cost levers

7 - Develop a category-specific plan

8 - Ideas to reduce total cost in practice

9 - Measuring the impact of cost reduction initiatives

AUDIENCE

This workshop will be of benefit to procurement managers who want to model and reduce total cost.  The programme will support category managers, vendor managers or those working in procurement with an interest in broadening the range of factors used in making procurement decisions.