PROCUREMENT
PROCUREMENT PLAYS AN important role in casting a critical eye over large contracts and purchasing decisions before they are made , ensuring the business gets a good deal . However , there is an opportunity for procurement to become more of a strategic partner to the business , which can help it deliver increased value for money spent .
The procurement process often focuses on reducing cost , rather than increasing value , which is significantly different . As a result , many procurement teams are doing themselves and the business a disservice .
Research by the MCA found that senior procurement professionals said they could increase the value of their management consultancy spend by 36 percent if they had a clearer definition of business needs and project scope .
Getting closer to the business objectives could really be a win-win situation for both the procurement department and the business and allow procurement teams to achieve the best value goods and services for the business .
One facet of securing services on a project is how the company is actually billed for it . Time and material contracts , where an organisation pays for the hours a consultant works on a project , dominate how services are procured . But they are not the only way to hire consultants ; there is also the option of fixed price contracts .
These can bring confidence and certainty to procurement as it ’ s established up front how much a project will cost and what the business will be getting for this price . But they must be handled in a different way to time and material contracts .
Ask the right questions Procurement needs to work closely with the business to understand the scope of the project and what the business is trying to achieve .
By putting together a clear brief with the business , they will be able to communicate more effectively with the supplier and ensure that the supplier is well placed to achieve what the business is looking for .
It ’ s also important to find a supplier who has experience in the
24 October 2014