If you take down any picture in my apartment you will notice the same thing behind every one, there are at least 3 or 4 holes from failed attempts to line up the picture properly. There was no rhyme or reason to my hanging strategy at the time, no measurements taken. I just went for it until it was as good as it could get. But not having a plan will eventually cost me – probably a rather large portion of my deposit.

As with hanging pictures or building a bookshelf or any number of DIY projects, when making decisions about where to cut costs and reduce resources you must act with precision. One wrong cut could easily cause a negative impact throughout the business. Before you make the cut, you need to be double, triple check your calculations, understand the metrics and then take the appropriate action.

But what measures are most important when making these decisions? Which will define where you are successful and where you are struggling?

In Coupa’s recent webinar “Big Bang Benchmarking”, experts Mickey North Rizza, AMR Research analyst and supply chain expert, and Ravi Thakur, Coupa’s resident expert on transactional benchmarking and measurement, laid out 10 must measure metrics to identify what’s working and where you need to consider making cuts.

1. Requisition & PO Approval Cycle (Time): How efficient is your process? Are there areas that can be eliminated or streamlined to improve cycle times?
2. Orders & Invoices Processed per FTE (#): How efficient are your resources? Are they aligned with the volume of orders and invoices that need to be processed?
3. Purchasing Operating Costs (USD): How much does it cost for you to run your procurement process? Where can costs be further reduced?
4. Days Payable Outstanding (DPO): Are bills getting paid on time? Are there opportunities for further discounts?
5. Touchless Procurement: How many manual resources are necessary to manage the process? Where can manual intervention be addressed using automation?
6. Savings / spend: How much are you savings based on spend? Can you be saving more by eliminating unnecessary spend?
7. Quality – Rejection %: Are you only spending on the necessities? What projects can be cut or deferred?
8. Cost of Processing per Order & per Invoice (USD): How costly are your resources? Can you reduce the costs while maintaining productivity?
9. Spend Under Management: How much of your spend is actively managed? Are you missing opportunities to further cut costs by not seeing what you are spending?
10. Customer Satisfaction Ratings: Are customers happy with the goods and services they receive? Do resources need to be shuffled to address dissatisfaction areas?

So, maybe my grandpa was right when he said, “measure twice, cut once”. It really is the only way to ensure that you are making the right cuts before you do something that will cost you – like hammering a bunch of random holes into a wall.

To learn more about the 10 must measure metrics for success, watch Big Bang Benchmarking on demand at: http://www.coupa.com/big-bang-benchmarking-webinar