Roles of Procurement

Click to edit Master subtitle style Presentation by Aayush Thakral Ahana Chakravary Abhinav Sharma Ashish Banka Anshuman Choudhury Bhuvan Maru

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Introduction
Traditional belief about procurement:Procurements primary role is to obtain goods and services in response to internal needs
Procurement Integral

has a far more important role

part of a company strategy

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Roles of procurement
Support

operational Requirements Manage the Purchasing process efficiently and effectively Supply base management Develop strong relationship with other functional groups Support Organizational goals & objectives Develop integrated purchasing strategies

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Support Operational Requirements

Roles

interchangeably used with Purchasing Understand business requirements Buy products and services

At the right price From the right source At the right specification that meets users needs In the right quantity For delivery at the right time To the right internal customer

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Support Operational Requirements (Cont.)

Internal customers of purchasing include: o Manufacturing o Physical distribution centers o Engineering and technical groups o Research and development o Information technology o Transportation and other services

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Management of the Purchase Process

Purchasing

must manage its internal operations efficiently and effectively.

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How it can be achieved

Leadership

of procurement for the organization Ownership and accountability for sourcing processes Communication of purpose, process and pay off Collaboration and partnering Teamwork

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Supply Base Management the selection, It is a process involving

maintenance and development of supplier. Supply base management is the art of getting the most out of suppliers by providing insights into supplier selection, oversight and development. Results in reduction in cost and strong supplier relationships

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Functions of Supply Base Management

To

ensure that current suppliers are competitive. Identify new suppliers who has the potential for excellence performance and develop close relationship with these suppliers. Improve and develop existing suppliers who are not competitive

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Develop strong relationship with other functional groups

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Role: Support Organizational Goals and Objectives

Procurement

objectives should be aligned to organizational goals It should not function as a separate entity Timely evaluation of governance structure for
a) b)

Balanced decision making Transparency

Governance

should be designed such that it ensures timely flow of information

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Role: Develop integrated purchasing strategies

Effective purchasing strategies involve:

Monitoring supply markets and trends (e.g., material price increases, shortages, changes in suppliers) and interpreting the impact of these trends on company strategies Identifying the critical materials and services required to support company strategies in key performance areas, particularly during new product development Developing supply options and contingency plans that support company plans Supporting the organizations need for a diverse and globally competitive supply base
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