Those of us who have been in the procurement profession for a while know that other departments within our organization don’t always hold the purchasing department in the highest esteem, regardless of the quality of work that the Procurement Department has done. It’s not uncommon to learn that the Procurement Department was the topic of a complaining session at the…
Supply Chain Disruptions, Global Pandemic, Mass Layoffs, Economic Downturn, and a New Normal perspective for Supply Chain Operations. An Annual Procurement Plan is critical to efficiently and effectively manage and conduct the essential elements of today’s Procurement Mandates. In this article, we will outline the Framework for a Top-Class Annual Procurement Plan. In later segments of this work, we will…
Establishing a Procurement Dashboard is an excellent tool for reporting procurement performance. A Purchasing Dashboard is a single-page document that contains four charts that illustrate the performance of a procurement department. The Procurement Dashboard is designed to present procurement performance data to executive management “at a glance.” NLPA has designed the following Procurement Function Dashboard to assist practitioners in designing…
Procurement Departments are created for the understanding and translation of customer needs and requirements to the selection of capable suppliers, to realize the cost-effective acquisition, receipt, and payment of vital inputs and raw materials. Factors impacting the Total Cost of Ownership such as quality, efficiencies, delays, stock-outs, obsolescence and carrying cost are heavily emphasized in the procurement discipline. Procurement Personnel must master 3 critical…
The last decade has yielded many events, forces, and elements in which a greater concern and scrutiny of the concept of Vendor or Supplier Risk Management has risen. At the forefront are driven for Cost Reduction, Top Line Growth, and Competitive Advantage. Supplier Risk Management Processes are underpinned by: Identification of Potential Risks emanating from the interaction of buying…
A purchase order (PO) is a commercial document and first official offer issued by a buyer to a seller indicating types, quantities, and agreed prices for products or services. It is used to control the purchasing of products and services from external suppliers. The purchasing process starts with a need. That need should be verified. The item requirements are checked and noted the PO.…
The Procurement Function currently exists in an environment of ever-increasing technological advancements. Procurement Leaders are tasked with the responsibility of paving the way for transforming their operations to meet the demands of the modern business landscape. Currently, Procurement Function Models are fragmented, tactical focused, cumbersome, siloed, and labor intensive. The future requires the Traditional Core Competencies of: Category Management Supplier…
The Procurement Function is a vital part of the Supply Chain Mechanism, which is responsible for the acquisition of mission-critical inputs for the realization of business objectives. Even though procurement plays a pivotal role in supporting critical operations, managing spends, and mitigating supply risks, it often receives less regard than due. A close examination of Procurement Operations would reveal that…
The Procurement Function has traditionally been perceived as cumbersome, slow, and a necessary evil for doing business. The demands of the modern customer for products delivered cheaper, better, and faster puts unprecedented stress on procurement functions to ensure consistent supply of mission critical inputs to be converted into useful products and services.to be consumed by customers. The Procurement Function can…
Modern technologies are poised to upend the Procurement Function as we know it. All aspects of procurement’s three domains, managing spend, protecting organizations from risk, and supporting operations will see significant breakthroughs in the years to come. In 2019 we will notice the following Technology Breakthroughs in Procurement: Unprecedented focus on Advanced Risk Management Capability: Risk Management is a critical component…