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• All spend regards all external direct, indirect and capital spend, which includes all outsourcing and in-

sourcing opportunities in order to optimize the use of supply base competencies and internal
competencies

• Benefits accrue from understanding the activities involved in providing a product or service and the

costs of these activities to the supplier, and then working with suppliers to reduce the cost of those
activities through joint process improvements

• Cost reduction accrue from improving the performance of the supply chain through improved quality

levels, reduction/elimination of inspections, just-in-time (JIT) deliveries, improved service levels, and
reduced failures and improved products and supplier involvement in the design and specification
processes

• Cost reduction accrue by reducing the proliferation of part numbers, brands, and unique items and

through the use of commercially available parts versus original equipment manufacturer parts