By procurement we mean all activities in an enterprise to organize materials, services and means for work.
Brief description
The procurement function is becoming increasingly important due to:
Reduction in own production
Globalization of markets
Transfer of supplier competencies
High potential for rationalization and scope of supply logistics
Growing awareness of resources
Tasks and objectives
Tasks are divided into strategic and operational departments. Strategic procurement tasks include:
- Supply market research
- Decisions between central and decentralized procurement
- Decisions regarding organizational structure
- Analysis, evaluation and development of suppliers
- Negotiation of framework provisions
- Introduction of information and communication system
- Conduct a potential analysis and create a portfolio
- Responsibility for procurement risk management
- Supporting and introducing logistics-oriented procurement concepts
- Capacity planning
- Make-or-Buy decisions
The operational tasks are based on the procurement process and read as follows:
- Determination of demand (material assortment planning and material demand planning)
- Control of resources
- Supplier selection
- Budget release
- Order
- Control of the order
- Logistics
- Payments
The goal of procurement is to maximize the contribution it makes to the achievement of corporate goals. Procurement should therefore provide the right level of resources at the lowest possible cost.