Question

In: Finance

While in the private sector, I found purchasing processes to be much more efficient that in...

While in the private sector, I found purchasing processes to be much more efficient that in government, perhaps due to the lack of trust and confidence, what are your thoughts on this?

Solutions

Expert Solution

Purchasing process, or any other process for that matter, would evolve at a much different pace in a government than in private sectors. Agility, efficiency, lean and other strategic ideas that are embedded in the mainstream for private sectors would probably be very new for the public sector. The primary purpose and objectives are entirely different for the two sectors. If the firm is not efficient, it consequently would see less profitability and consequently not be sustainable. The government would not face this sustainability challenge but of different variables.

In private sector you would have seen various teams performing various functions such as sourcing, due diligence, negotiating, invoice management and then supplier management. This brings out two things - the process is much more streamlined and each team has an expertise in their role in the process.

While in the government sector (of course this varies heavily from government to government) you would probably not see a ‘strategic sourcing team’ or a ‘supplier relationship manager’.

I would say trust and confidence is of course a way for efficiencies to improve, however, regulatory oversight, agility and profitability being in focus would lead to much more efficient process which is not so for the government.


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