Procurement certainly has come a long way.
The simple definition of “procure” that everyone knows is
“to obtain, buy or acquire.” A more complicated definition would be something
such as “obtaining goods and services from requisition to receipt and approval of
invoice payment.”
Today, procurement (as “BUY”) plays a crucial role in all
aspects of the supply chain mega processes of PLAN – BUY – MAKE – MOVE – STORE
– SELL/DELIVER.
The new Tompkins Supply Chain Consortium report, Leading
Procurement Practices: Trends of the New Procurement Organization, notes
that procurement is shifting from tactical to more strategic activities.
In the past, procurement was very much a
transaction-oriented process, whereas today it is a strategic initiative
process. The shift from tactical to strategic can be attributed to procurement
activities such as market knowledge, supply base management, risk management, and
supplier selection, However, the core functions of strategic sourcing,
purchasing, procurement IT and supplier relationship management are also still
highly important.
Procurement is beginning to add value to the company through
strategic alliances and advanced competitive analysis. And as the function
gains ground, supply chains are demanding more skilled procurement professionals.
Some of the best and brightest are currently seeking careers
in the procurement field, and they need to understand how to be effective in
today’s complex supply chain environment.
Organizations are looking for broader experience in
procurement due to increased globalization. This includes advanced relationship
building and multilingual skills. Even professional societies are providing
certification to enhance the skills of the professional workforce.
The Consortium report also indicated that the number of
colleges with supply chain and procurement degrees is on the rise. So, I think
it is safe to say that involvement in procurement is higher and will continue
to advance further into supply chains.
What is your company’s current take on procurement? Is the
evolving nature of procurement affecting how you hire staff?
Resources
Hot Topic Report: Leading
Procurement Practices: Trends of the New Procurement Organization
Article: Procurement
Process Improvements Can Lead to Increased Shareholder Value
Case Study: Procurement
Assessment
The
Buy Process: Asia Supply Chain Excellence