What procurement transformation looks like

Procurement transformation

A simple definition of the word transformation is a dramatic change in form or appearance. Transforming your procurement operation is no small task, and could involve several years of refining and tweaking.

Components of procurement transformation

container shippingA world-class, top-performing procurement group typically has several organizational components including:

  • Procurement Center of Excellence (CoE)
  • Sourcing excellence
  • Market intelligence

If you have a smaller procurement organization, multiple roles may be performed by the same individual. In larger and/or global procurement groups, the roles that each group performs can be summarized as follows:

Procurement CoE: Responsible for technology and/or procurement processes across the company; This role includes revisions to any procurement policy as well as overall compliance. Most companies going through procurement transformation will need the support of several executives based upon the changes desired across the entire company.

Sourcing excellence: Responsible for executing sourcing events with or without sourcing technology; technology used to source goods and services include ScanMarket, Ariba, and others.

Market intelligence: Responsible for researching and building all categories for all areas being sourced; Category Management plans should be developed for every sourcing category and included for sourcing excellence employees to execute sourcing events

The transformation of procurement and sourcing groups generally pays for itself many times over. Naturally, you want your company to be as lean as possible and to resist hiring more employees than you have to.

While this information is not intended to be all inclusive, we encourage you to contact Bryan Eaves of Sourcing Business Solutions at 865-805-4356. We will be glad to speak with you.

Resources: What procurement transformation looks like

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