09 June 2005 | David Arminas
BAE Systems is to shift internal procurement training to project management skills and away from commodity buying.
Russ Armitage, chairman of the BAE Systems procurement council, said the move will reflect the defence company's changing business strategy.
Traditionally, it has made and sold equipment to customers, which organised separate maintenance contracts.
But the new trend is for BAE Systems to offer this service in its product package. The result is that BAE needs purchasers who can better manage major projects worth between £2 million and £250 million.
"We are doing more and more buying to support and maintain the products, rather than clients such as the Ministry of Defence doing this procurement work," Armitage said.
"This means we need to have the best skills for negotiation at the most senior levels, a better overall commercial knowledge, exceptionally good knowledge of markets and supplier offerings, and a good deal of technical knowledge."
He explained that BAE is moving indirect procurement into an outsourced purchasing unit one area at a time. This will include engineering and non-technical contract labour, and stationery.
BAE puts around 100 purchasers a year, including 15 senior people, through the Procurement Developing You training programme, developed with Warwick University.
The company has around 60,000 employees in the UK, of whom around 1,400 are qualified purchasers.
"Of those purchasers, roughly 80-90 per cent began their career with us as graduates or young people."