10-Step Procurement Transformation, Part II

PurchTips - Edition # 165 November 11, 2008

By Charles Dominick, SPSM

What Steps Complete A Procurement Transformation?

Part Two of our step-by-step guide to procurement transformation is designed to ensure your new organization is successful and sustainable!

6. Define Performance Metrics - Metrics are needed to assess transformation performance against goals. Choose published metrics whenever possible. Comparisons against credible sources (e.g., NLP, CAPS, Hackett, etc.) can help evidence your success as well as identify areas for improvement.

7. Structure Your Organization to Support Transformation - Fully centralized procurement organizations are not the right answer for every company. Consider the geographical and Business Unit needs as well as the complexity of the goods and services being sourced before deciding on the final organizational structure.

8. Develop Standardized, Optimized, and Documented Procurement Processes - Detailed, yet understandable documentation is essential to the survival of your transformation. Without it, your hard work can quickly become undone as old habits return. Involve key "influencers" in process improvements to avoid transformation rejection.

9. Create Policies to Support Transformation - Policies should clearly state who in the organization is allowed to commit company funds and what process has to be followed to do so. Limit the number of authorized agents and establish clear spend limits to reduce maverick buying.

10. Continually Review and Refine - Review your original goals and progress made with key stakeholders after 90 days and at least twice per year thereafter to ensure continued alignment. Refine your procurement transformation plans and keep the focus on continually increasing the value delivered.

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Spotlight On Professional Development Opportunities

Government reports indicate that the unemployment rate is at its highest level in a long time. Unfortunately, purchasing positions are not immune from being eliminated.

What this means for you is that this may be a risky time in your career. If you're not currently employed, you will have a lot of competition for the available purchasing jobs. If you are employed, your organization's management may right now be trying to decide who they can let go.

Distinguishing yourself as an achiever in purchasing is key to sustaining a rewarding career, even in these difficult economic times. Earning your SPSM^® Certification  by completing the Senior Professional in Supply Management^® Program is the action to take to prove that you are an achiever. Learn how to earn your SPSM^® Certification (and  perhaps get an iPod) at:

 www.NextLevelPurchasing.com

The Latest Purchasing News

• Purchasing Managers/Directors: Are you struggling to develop a plan for improving your team's performance? If so, visit: www.NextLevelPurchasing.com/benchmark
• Considering a career move?   Browse several new jobs preferring candidates with the SPSM^® Certification  posted at:  
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