Caterpillar targets purchasing metamorphosis

10 March 2011

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10 March 2011 | Lindsay Clark

Global manufacturing firm Caterpillar has launched a “procurement excellence organisation” to boost buyer skills and meet the challenges of company growth.

At a time when infrastructure projects and mining investment are boosting demand for the heavy machinery the company manufactures, it wants to improve its procurement skills to ensure suppliers are able to keep up and match business needs.

CPO Frank Crespo, who joined the firm in August last year from Honeywell, said securing supply was a priority in this growth period, as was achieving a better understanding of the business requirements.

To improve skills within the purchasing and sourcing team Crespo has created a specialist training group to help staff understand new processes and more effectively measure their success. Around 70 employees at the company are currently focused on changing the way the purchasing division operates.

While the procurement division, which employs around 1,300 staff worldwide and spends $25 billion (£15.4 billion), is working from a “solid foundation” Crespo told SM he wanted to help them become more business focused.

“We’re really engaged on the objectives and the key challenges that [the business] may be facing, that they want us to be a part of. We’ve created this excellence organisation with a mindset of serving the leadership and teams within the division to empower the procurement professional at the desktop.”

The group, which is being created largely without the use of external consultants or professional bodies, was necessary because day-to-day responsibilities make concentrating on improvement difficult, he said.

“A lot of the tools or systems or process that you want them to have, their bandwidth is not there to go get that done and their focus is not there to go get that done,” said Crespo.

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