Procurement Glossary
Specifications: definition, methods and importance in Procurement
November 19, 2025
The requirements specification is a central document in the procurement process that defines the concrete requirements and specifications for a product or service. It forms the basis for tenders, supplier selection and contract negotiations. Find out below what constitutes a specification sheet, what methods exist for creating one and how it is used strategically in Procurement .
Key Facts
- Detailed specification of all technical and functional requirements for products or services
- Legally binding basis for contracts and acceptance processes
- Distinguishes itself from the specification sheet through concrete solution approaches instead of general requirements
- Reduces misunderstandings between client and supplier by up to 70%
- Enables objective evaluation and comparison of offers from different suppliers
Contents
Definition: Specifications
The functional specification describes in detail how the requirements formulated in the specification sheet are to be implemented technically.
Core elements of a specification sheet
A complete specification comprises several essential components:
- Technical specifications and performance parameters
- Quality standards and test criteria
- Delivery dates and milestones
- Documentation and training requirements
Requirements specification vs. functional specification
While the requirements specification defines the "what", the functional specification describes the "how". The functional specification concretizes the general requirements of the requirements specification into measurable and verifiable specifications. This distinction is crucial for a successful request for quotation.
Importance in Procurement
In procurement, the requirements specification serves as a communication tool between Procurement and suppliers. It minimizes room for interpretation and creates an objective evaluation basis for requirements management.
Methods and procedures
The systematic creation of a specification follows proven methods and structured processes.
Structured requirements analysis
The basis for this is a comprehensive needs analysis of all stakeholders. Functional and non-functional requirements are systematically recorded and prioritized.
- Workshops with specialist departments and users
- Technical feasibility studies
- Market analysis of available solutions
Specification methods
Various approaches enable the precise formulation of requirements. Specification management uses standardized templates and checklists for consistent documentation.
Validation and release
A multi-stage review process ensures completeness and feasibility. Technical experts, Procurement and the legal department validate the document before final approval for tenders.
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Key figures for controlling the specifications
Measurable key figures enable the objective evaluation of the quality of the specifications and the success of the procurement.
Completeness and quality indicators
The completeness of the specifications is measured by the degree of coverage of all relevant requirement areas. Quality indicators evaluate the precision and clarity of the specifications.
- Requirement coverage in percent
- Number of subsequent change requests
- Average processing time per specification
Procurement efficiency metrics
The success of the specifications is reflected in the efficiency of the downstream procurement process. Fewer queries and faster tender submissions indicate high document quality.
Supplier compliance rate
Compliance with the specifications by suppliers is continuously monitored. Deviation analyses identify potential improvements for future specifications and support complaints management.
Risks, dependencies and countermeasures
The creation and application of specifications entails various risks that can be minimized by taking appropriate measures.
Incomplete requirements definition
Incomplete or imprecise specifications lead to misunderstandings and renegotiations. A systematic determination of requirements with all stakeholders significantly reduces this risk.
- Structured checklists for all requirement areas
- Multiple validation by technical experts
- Prototyping and proof-of-concept phases
Over-specification and cost drivers
Overly detailed or excessive requirements restrict the range of suppliers and increase costs unnecessarily. A good balance between precision and flexibility is crucial for cost-effective procurement.
Change management challenges
Subsequent changes to the specifications can lead to delays and additional costs. Structured change management with defined processes and acceptance criteria minimizes these risks.
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Practical example
A mechanical engineering company draws up a specification sheet for the procurement of new ERP software. The 45-page document specifies all functional requirements, interfaces to existing systems and performance criteria in detail. The precise documentation enables five providers to submit comparable offers, resulting in a cost saving of 15% compared to the original budget planning.
- Reduction of the offer evaluation time by 40%
- Elimination of 80% of the usual queries
- Successful project acceptance without renegotiation
Trends & developments around the specification sheet
Digitalization and new technologies are fundamentally changing the creation and management of specifications.
Digital specification tools
Modern software solutions automate the creation and management of specifications. Collaborative platforms enable simultaneous processing by different stakeholders and ensure version control.
- Template-based creation with ready-made modules
- Automatic consistency checks and validation
- Integration into existing ERP and procurement systems
AI-supported requirements analysis
Artificial intelligence supports the analysis of existing documents and suggests relevant specifications. Machine learning recognizes patterns in successful projects and optimizes the creation of future specifications.
Agile specification development
Inspired by agile development methods, iterative approaches are created for the creation of specifications. These enable more flexible adjustments during the procurement process and significantly reduce time-to-market.
Conclusion
The specifications are an indispensable tool for successful procurement projects. It creates transparency, reduces risks and enables objective supplier evaluations. Increasing digitalization opens up new opportunities for more efficient creation and management. Companies that invest in professional specification processes achieve measurably better procurement results.
FAQ
What is the difference between specifications and functional specifications?
The requirements specification describes the requirements from the user's point of view ("What should be achieved?"), while the functional specification defines the specific technical implementation ("How should it be realized?"). The functional specification is more detailed and forms the direct basis for contracts.
Who is responsible for drawing up the specifications?
They are typically created in collaboration between the specialist department, Procurement and IT. The specialist department defines the technical requirements, while Procurement introduces the procurement-relevant aspects and contractual conditions. A central project management team coordinates the process.
How detailed should a specification sheet be?
The specifications should be as detailed as necessary, but as flexible as possible. All critical requirements must be clearly specified, while scope for supplier innovation can be left for less critical points.
Can specification requirements be changed retrospectively?
In principle, yes, but changes should be minimized as they lead to delays and additional costs. Structured change management with defined release processes and impact analyses is essential for controlled adjustments.
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