While there are many different jobs in the world of business, each with its own responsibilities and tasks, some are still more specific than others. For example, you may have heard the term procurement management before, but aren’t exactly sure what it means or what kinds of responsibilities come with the job. If that’s the case, then this procurement management 101 guide is for you! In this article, we will give you an overview of the basics of procurement management and why it’s so important to organizations large and small all over the world.
What Is Procurement Management
Where does procurement fit into a company’s supply chain? The answer to that question can be complicated, but at its core, procurement (or procurement management, if you prefer) involves managing all of a company’s purchasing activities. This ranges from looking for new vendors to making sure those vendors are getting their materials to customers, who in turn get their products quickly and at a reasonable price point. In short, supply chain planning and execution rests largely in someone’s procurement management—and they have a lot of critical tasks to accomplish each day!
Why Is Procurement Management Important
When you think of procurement, what comes to mind? If you’re like most people, it’s purchasing or supply chain management—and that means you need to get into a formal program that teaches you how to run these vital areas of business operations. Many experts say it’s one of two fields that will see significant growth in job opportunities in coming years, making now a great time to get up to speed on all things procurement! The following are some of our favorite articles about procurement from some of our favorite blogs around the web
The Lifecycle of Supplier Relationships
When you’re in business, relationships matter—especially with your suppliers. You can’t function without them, after all! Strong supplier relationships mean happy employees and customers, which will lead to more sales for you. When an employee has good relationships with his or her colleagues (particularly when those colleagues are clients), they will not only feel valued but also motivated to do a great job at work to make their clients (and friends) happy. What’s more, these stronger connections are much more likely to lead to long-term success than short-term gains that never materialize into anything bigger. In short, take care of your suppliers—because they take care of you!
Key Business Processes Affected by Procurement Management
The Department of Commerce estimates that businesses in America lose roughly $75 billion each year due to poor procurement practices. What exactly are these poor practices? Often, they include a lack of defined purchasing procedures, a disorganized to-buy list, an ineffective vendor approval process and unreliable supplier relationships – among other things. What can be done about these issues? The most effective solution is to invest in an enterprise-wide procurement system that automates business processes related to purchasing and supply chain management; integrated platforms put control back into your hands without sacrificing efficiency or adding layers of red tape to your everyday workflow processes.
Conclusion
With no shortage of books and resources available on procurement management, it can be a little intimidating for the first-time buyer to get started. Whether you’re new to the concept or have been on the job for years, it’s always a good idea to keep your eyes open for new ways to improve your company’s efficiency, save money and make sure that all of your employees are working towards the same goal: customer satisfaction.
