Total Cost of Ownership vs. Total Supplier Spend: Serving Different Functions

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Jeanette Nyden

Recently, a newer employee working in supply chain at a public utility asked me the following:"What is the difference between a Total Cost of Ownership and Total Supplier Spend? We need to cut costs next year and there is a line in the supplier’s scorecard for TCO but I don’t know what it means."She was rightfully confused because what the utility wanted to accomplish and what it asked for were two different things. Unfortunately, the supply chain professional who developed the scorecard did not...
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