Sourcing and Procurement
Glossary
Your trusted guide to exploring sourcing and procurement terms & definitions,
from the world’s leading procurement experts and companies
Ergonomics
Adapting the workplace environment to the user, e.g., ensuring chairs and desks are at a comfortable working height, lighting is adequate for tasks, etc.
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Escalation clause
A contract provision which permits the adjustment of contract prices by an amount or percent if certain specified contingencies occur, such as changes in the vendor's raw material or labor costs.
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European Union
A supranational organization created in the 1950s to bring the nations of Europe into closer economic and political connection. At the beginning of 2012, the 28 member nations were Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, The Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.
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Evaluation of responses
The process of analyzing the responses to a Request for Information, Request for Proposal or Request for Quote. The responsiveness and fitness for business is included along with a pricing analysis. The process usually results in an analysis and recommendation that impacts the contract negotiations, creation and management.
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Exception
A problem that arises during the execution of an automated process.
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Escalation Process
A detailed process that describes how issues and conflicts move through management levels for resolution. It is an important factor for third party relationships and should be documented in RFPs and other bid documents, as well as in the contract, performance management and change management plans.
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Escrow agreement
In the context of computer software, an escrow agreement involves the supplier placing a copy of the software source (original and updated) code (i.e. the raw form of the software design) with a third party. If the software supplier ceases trading, the purchaser will then be provided with the source code, which will enable them to continue to use and, where necessary, adapt and update the software (provided that they can appoint appropriately skilled personnel to do so)
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Evergreen Contract
An automatic contract extension. Vested agreements often create an Evergreen Contract where the supplier earns a contract extension at the end of each year. For example, at the end of year one the supplier can earn a 6th year. At the end of year two the supplier can earn a 7th year. This in essence creates an Evergreen Contract with a rolling five-year contract duration that highly motivates the supplier to keep making investments in order to earn the contract extension.
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Exchange Rate
How much it takes of one country's currency to equate to or to buy another country's currency. For example Japanese Yen to U.S. Dollars, British Pounds to U.S. Dollars, etc.
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