11 Dec Procurement just buy, don’t they?
Is your business making the most of procurement? This survey was published earlier this year and it clearly illustrates that to gain the most from Procurement, they need to be on the front foot leading the business. All too often, I’ve seen a reactive team dealing with day to day issues.
In reality, Procurement’s management time is frequently absorbed by negotiating unforeseen price challenges, sourcing materials for a project that is already in motion or managing supplier performance. Areas where their influence of power has often been curtailed by factors out of their control. The real potent value is through harnessing the data they share with their suppliers, analysing information to identify where opportunities can be found and then collaboratively driving efficiency gains such as found in Total Cost of Ownership modelling.
- Procurement must develop a collaborative business model with their suppliers so that data can be shared.
- It is no longer possible to just look at costs from a budget perspective.
- Business has to find the meaning behind those costs to create value and for this procurement holds the key to unlocking the problem.