The article looks at various types of procurement functions and procurement strategy benefits for companies. Mainly, the type of procurement function that an institution desire gets determined by its culture. Every company sits somewhere on the continuum between centralized and fully-decentralized structure. However, the important thing is that an institution gets to provide optimum value for money and comfort. There are four types of procurement functions, and they include strategic, supportive, commercial, and clerical. Significantly, one needs to conduct an assessment of an institution to determine areas where change should occur. The essay helps in understanding the types of procurement functions and procurement strategy benefits for companies.
PROCUREMENT STRATEGY BENEFITS AND IMPORTANCE OF PROCUREMENT
There are some procurement strategy benefits that a business may benefit from in the long-term. Unfortunately, some businesses fail to see the importance of procurement and usually misunderstand their role. Importantly, optimizing procurement leads to several benefits and adds value to a business. First, effectively managing procurement enables a company to lower costs by procuring goods and services at the best prices. The business also gets to makes the most of the discounts and warranties that are available. Secondly, a functional procurement process leads to greater efficiency as a company will get quality goods and services. Lastly, the discussion on the types of procurement functions and procurement strategy benefits highlights the importance of procurement roles.
procurement strategy benefits and importance of procurement
TYPES OF PROCUREMENT FUNCTION AND BENEFITS OF E-PROCUREMENT STRATEGY
A strategic procurement function would allow for a company to realize the benefits of e-procurement strategy. Mainly, e-procurement automates difficult tasks, including document management for purchase orders and supplier evaluation and selection. This leads to increased speeds in doing business and frees up staff. Significantly, e-procurement improves workflows for procurement, thus enabling decentralization, end-user self-service, and efficient processing of supplier payments. Also, e-procurement gives an organization visibility into its spending. The data helps identify consolidation areas of suppliers and leverage buying power, thus negotiating cost savings. Employing types of procurement functions, such as a strategic one, will allow a company to enjoy procurement strategy benefits.
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