The Procurement function is seeing its role develop and its contribution to the creation of value by the enterprise increase : strategic procurements, involvement in R&D projects, increased synergies with the supply chain…

Whilst Procurement functions are obviously a key part of cost control by the enterprise, they have also become an essential player in Business performance. They are collaborating much more widely, as much internally, with the other players in the enterprise, as externally, applying lasting partnership and extended enterprise strategies.

In this context, the Procurement function must clearly serve, on a daily basis, its internal clients, who have become more demanding, but must also : 

  • Re-think its organization so as to be better aligned with its strategy
  • Optimize its processes, whilst at the same time controlling its own costs
  • Equip itself with the means for increased collaboration between buyers and with its operational partners
  • Put in place an efficient set-up for managing its performance

These systems and tools are strong levers for mobilizing Procurement teams, but are also means of communication and valorization for the function. 

Organization & mobilization of the the function

The Procurement function must itself ensure that it is effective and provides quality services for its internal clients. It must also mobilize its teams around a strengthened and clearly communicated strategy.

  • Optimize operational processes
  • Develop the organization of the Procurement branch : level of centralization / decentralization, project responsibilities
  • Animate the branch : re-define profiles, the training and career backgrounds to attract and retain the best buyers and valorize collective performance
  • Put in place tools for active collaboration between buyers and with their clients and partners

Procurement performance management

The Procurement function must be capable of measuring its contribution to the creation of value by the enterprise. To do this, it is equipping itself with its own steering systems, which are also becoming communication supports.

  • Design the steering model : balance to be found between managing costs and savings achieved, and monitoring qualitative, operational indicators – innovation, competitiveness, sustainability…
  • Share this model with its internal clients, but also with Finance
  • Strengthen simulation capabilities – changes in Procurement costs, measurement of impact on the gross margin - and integrate them into the enterprise's management cycle - budget / Forecasts
  • Choose and put in place appropriate information systems

REFERENCES

  • International energy group

    Support the implementation of the new organization model for the Procurement Department: describe the target organizational model (Matrix Organization) and formalize job descriptions.

  • Richardson

    The Richardson company installed Qlik for their data analytics and exploration capacities which are impossible to obtain with traditional BI tools. The majority of their management units use it today for all their analyses of sales and purchases performance.