Procurement must use ideas to improve other functions

20 May 2007
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21 May 2007 | Antony Barton

Buyers must look beyond their organisation for fresh ideas and consider how they can help the company as a whole, rather than just procurement.

Professor John Bessant, chair in innovation management at Tanaka Business School at Imperial College London, said: "Not all the smart people work for us - they never could. Unless you're going to take over the world and integrate it all, the argument would be to strike a balance with external innovators."

Addressing a business forum in the capital, he referred to Procter and Gamble's policy of seeking 50 per cent of its innovations from outside the company as a successful business model, and one with lessons for procurement.

As well as collaborating with suppliers and customers to improve processes, a procurement department should use its sources and information to inform other parts of the organisation.

Bessant said business is an increasingly network-based "multi-player game" and product or service innovation is too important to leave to R&D or marketing.

He concluded: "Quality is all of our responsibility and there is key potential for procurement to use resources out there to innovate and improve our products and offerings."

SMmay2007

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