You may wonder what kinds of purchasing issues are grabbing attention of the executives,
VPs, CEOs.
Certainly, they are always interested because of the purchasing importance for the
business.
My name is Americo Cunha, in this lesson, we will be working on strategic roles of purchasing.
Welcome, and let's start learning.
The strategic vision on purchasing is mainly related to supply continuity, quality, and
costs.
Supply assurance has an special attention and the five rights portrait very well the
challenges to be managed.
Ok, let’s discuss 7 critical dimensions of the purchasing function
First the spend analysis.
It is based on historical data and should display all expenses broke down
per item per period and per business unit.
It is important to get consumption numbers because they are crucial to demand management.
Consumption rate, sales, and production forecasts are the primary inputs to define sourcing
strategies, capacity levels and to assure the supply required
for business operations.
Here, the Purchasing personnel should gather technical
and functional requirements.
They have to ensure that all transactions are well documented.
By combining requirements from distinct areas, they can reduce the overall cost.
The purchasing team develops insights to align internal needs and external sources.
To facilitate the work, internal resources and external sources
are grouped by related products and type of application.
Supplier evaluation is one of the most important activity
conduct by the purchasing team.
The primary objective is to reduce supply risks
and optimize the value added to the company.
These two tasks are under the direct responsibility of the purchasing team, contract and cost
management.
The purchasing department is usually the primary contact with suppliers.
And also should control and manage the purchasing costs.
Requisitioning, RFI, RFP, RFQ, Contract Award, Orders, Approval, Receipt,
Payment are some of the tasks of the procure-to-pay process.
We will be workING on this topic deeper in a future lessons.
Here, the purchasing team works on day-to-day transactions
to mitigate supply risks, identity opportunities for cost reduction
and manage suppliers performance.
Another key task is to develop the purchasing organizational structure
and its governance procedures.
Therefore, the supply strategy involves spend analysis, demand management, specifications,
category and supplier management, contract management, cost management,
purchasing process, and supplier relationship management.
Thanks for watching, see you in the next lesson