Question

what are some examples of contributions that a purchasing department can make to an organization's strategic planning process?

what are some challenges in implementing e procurement tools

why is purchasing becoming more involved on transportation services and other nontraditional purchasing areas

Answer 1

Examples of contribution by purchasing department in organization's strategic planning process include:

• It can help to reduce the supply risk by arranging or developing alternate vendor for supply of the material. Example: Calcium carbonate was supplied by one vendor alone, so Colgate arranged and qualified second vendor who acts as a backup for the supply
• It can ensure timely supply of new material by working closely with the vendors. Example: Colgate made new paste formula for which it required phosphoric acid. It worked with vendors and helped them to set up process to manufacture the item
• It may help to minimize the risk of quality failure of incoming material by aligning with vendors well in advance. Example: At Colgate, purchasing department is involved in monthly Quality meetings so that it can work with them to minimize the issue
• It can help to lower the cost of material thus helping in improving overall profit margin. Example: Colgate worked with plastic film vendor on how to reduce the film thickness and still deliver high quality product which meets requirement thus helping to minimize cost