15 February 2007
More than half of all HR departments believe they can negotiate with suppliers as effectively as procurement.
In a study, by SM's sister title People Management and HR consultancy Reflect, 60 per cent of HR departments said they could handle negotiations as well as buyers.
Some 65 per cent of respondents said the departments could work more closely to benefit their business. Yet tension between the functions still remains, as only 28 per cent of HR professionals said procurement knew enough about the supplier markets they used.
Over half of HR departments said procurement was taking an increasing role in their work, and 78 per cent claimed that cost saving was where purchasing could add most value.
Justin McAvoy, director of Reflect, said: "While HR realises that procurement does add value by driving down costs, there is a concern that this will have an adverse effect on the quality of candidates being recruited."
He told SM that both departments should try to understand each other's objectives more clearly but added that HR often has "softer" targets that are less measurable than those in procurement.
Rebecca Clake, adviser, organisation and resourcing, at the Chartered Institute of Personnel and Development, agreed with McAvoy. "The departments need to make sure they understand each other's agenda," she said.
McAvoy also said that joint success would help both departments gain influence in the company.