CSMP The Concept of Value

From a management perspective, value is the amount of resources that an organization receives in exchange for the cost associated with the acquisition of goods and services. Value is a measure of the cost-benefit relationship of an exchange, which includes the total cost of ownership, the quality of the product or service, and the timeliness of its delivery. Value is also a measure of the impact of an exchange on the organization’s performance and objectives.

From a purchasing perspective, value is an amount of money that is exchanged for goods or services. It is the ratio between the cost of the goods or services and the perceived benefits received from them. Purchasing value is based on the quality of the goods or services and their ability to meet the customer’s needs. Purchasing value is also a measure of the cost efficiency of an exchange, which includes the purchase price, the delivery time, and the availability of discounts or other incentives.