'Procurement agenda should be CEO's agenda'

31 October 2007 | Paul Snell

Purchasers should aim to add value to the business rather than just cut costs.

A study, published by the Hackett Group, said departments had to move through five stages to change from transactional purchasing to a function that focuses on boosting business performance. The model says purchasers should go from being buyers and planners, to negotiators, supply experts and project leaders, money and relationship managers and finally become trusted business advisers. At this final stage the report said "procurement's agenda is the CEO's agenda", explaining that the department's single aim should be to support the business strategy. It added the best procurement leaders did not wait for a change in leadership to take action, but sensed opportunities and "filled the leadership void themselves". Chris Sawchuk, procurement practice leader at Hackett, said: "These are steps in a journey that takes procurement organisations five to 10 years minimum. They enable procurement to move beyond cost savings and generate real competitive advantage."

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