16 March 2006 | Rebecca Ellinor
The top procurement teams offer much higher salaries, benefits and training and attract the most talented staff.
They have a greater ratio of procurement compared to non-procurement staff and 63 per cent fewer clerical staff overall. They also dedicate less time to transactional work, according to research from the Hackett Group.
As a result, "world-class" procurement organisations cost 20 per cent less to run than typical firms and have about half as many staff overall. Wage rates in these departments, including benefits and training, are 41 per cent higher than typical companies. They also dedicate 74 per cent more hours a year to training.
Chris Sawchuk, procurement practice leader at Hackett, said: "World-class procurement leaders establish a strategic function - fully integrated with other relevant parts of the business. Their staff lead teams who take a broad array of factors into account, not just purchase price."
Pierre Mitchell, senior business adviser at Hackett, said to do this they need more skilled and qualified employees.
The Hackett Group assesses performance for functions in major companies around the world. These include HR, supply chain, IT, finance, purchasing and legal services. It defines "world-class" as organisations in the top 25 per cent of their field for effectiveness and efficiency, or both.
Go to www.thehackettgroup.com