PROCUREMENT KEY ACTIVITIES

DEMAND & SPEND MANAGEMENT

As the department responsible for managing the company’s expenditures, the primary objective that must be achieved is procurement cost optimization. To accomplish this, it is impossible to do so without understanding the company’s needs and what is currently available in the market. This area of activity includes spend analysis, category management, strategic sourcing, and related initiatives.

SUPPLIER RISK & RELATIONSHIP MANAGEMENT

Procurement acts as the company’s representative when interacting with third parties in order to obtain the goods and services required to support operational activities. Naturally, there are risks that may arise from such interactions. Therefore, managing these risks is essential, and throughout the engagement process, supplier relationship management becomes an integral part of risk management itself. Activities within this area include supplier pre-qualification, qualification, and performance evaluation.

STAKEHOLDER MANAGEMENT

In carrying out its role, Procurement cannot operate alone. Significant support is required from various related functions, such as Finance & Accounting, the IT team, the Legal Department, requisitioners/users, the Board of Management, and potentially many others.

CONTRACT MANAGEMENT

The goods and services managed by Procurement are often recurring in nature over time. By establishing purchasing contracts for a specific period, process efficiency can be achieved. Even the first-time purchase of goods and services that are considered strategic typically requires a purchasing contract. Entering into a contract demands careful consideration of risk-related aspects, including the clarity of scope of supply clauses, liabilities and indemnities, exit clauses, and others. Procurement must also be able to manage contract renewal timing, duration, and other related requirements.