The layman’s definition of procurement is the act of obtaining things. In the business world it is defined as the act of obtaining or buying goods and services. Any business will agree that procurement is very critical to its survival. As a matter of fact there are departments dealing with procurement in all the big organisations. The processes involved in this sector are numerous. This process commences by planning for what the organisation needs, taking care of whatever the organisation has procured and disposing it after it has accomplished it’s purpose. This means that almost everything that an organisation owns will come and go through the procurement department. It therefore goes without saying that the processes in this area cannot be allowed to go below certain standards.
The practices of a good procurement department are those that ensure that values like integrity and transparency are embodied in the entire system. It is your procurement systems that will determine if you can take advantage of what the market has to offer. You should always work smart and efficient when procuring goods and serices. By having the best practices in you department you gain a competitive advantage in the industry.
The best way is to begin by doing a market research and analysis. This way you will be able to understand your market better. You will know the best suppliers to use for everything you need. This allows you to do strategic sourcing of the resources of the organisation. This market research may even reveal that the closest supplier is not necessarily the cheapest. The pros and cons of all the suppliers become clear when you do this research. You also need to do standard determination to ensure that everything you bring into your organisation meets the required standards.
It is good practice to have rock solid system of software to manage all the processes. The best would be an ERP software. You should however first establish which software is good for you and how to use it. ERP consulting can be helpful by giving the much needed guidance to those using the software to make good use of it and take advantage of its full potential. The ERP tools available to you can make the process run faster and more efficiently.
You have the option of going for procurement outsourcing if you don’t have the muscle to run your own department. You can do a quick spend analysis to determine if it would be cheaper to engage an outsider to help you with this duty. You can save by reducing the amount of resources you use in doing your own procurement if it turns out that outsourcing is cheaper. You can engage the resources that were previously doing the procurement in other areas.