When excessive cost savings measurement drowns the objectives

This paper presents the dynamics and complexity of implementing a cost savings measurement system in purchasing. It focuses on the technical and strategic aspects of the evolution of such a system in a renowned organisation. Few articles dealing with cost savings in purchasing use an empirical approach. Therefore, this research sheds light on significant issues, often neglected in the literature. Contributions to managers include lessons about the importance of overcoming the complexity of measurements, and recognising that it is easier to begin by measuring hard savings, followed by soft savings when the system is running well. Contributions to the scientific literature include the opportunity to follow the progression of a cost savings measurement system within an organisation, and a discussion about the limitations of such systems.