One important role of theprocurement specialistis to seek quality services or products to meet the needs and goals of the organization, and acquire them at an acceptable cost. They must thoroughly understand the policies, issues and risks that can accompany the procurement process and the ensuing steps in the supply chain. If these tasks can be accomplished successfully, the role of the procurement specialist can have a positive impact on the organization’s overall cost efficiencies and bottom line, validating the importance of their role.
In general, the classic procurement process involves five steps, which must be thoroughly examined. They are as follows: Define requirements, select supplier, produce agreement, administer day-to-day, and assess performance. These steps are essential, regardless of the amount of automation or e-sourcing that may be involved.
With that in mind, organizations can benefit from a procurement function that has these five main features:
- A detailed spend map that cuts across an entire organization and is updated regularly so all purchases can be analyzed continuously for need, value, pricing and quality.
- The ability to drive savings across the organization by continuously ensuring the right products come from the right vendors at the right price to meet organizational goals.
- The ability to engage with the entire organization to evaluate how reduced costs can be enjoyed across the value chain.
- An organization-wide focus on ensuring value through contract management and supplier relationship management.
- The ability to deliver acquisitions through an operating model that connects technical and commercial capabilities to drive organizational goals and optimum client outcomes.
The purchasing and supply management profession is clearly transitioning from placing purchase orders to establishing and managing comprehensive contracts with strategic suppliers. This has created a need for purchasing and supply managers to develop and refine contract preparation andcontract management skills.
