The purchasing organization VI) Strategy development a) Strategy processes

In the last article I wrote about the procedure necessary to implement a strategy. Starting from a fully new approach purchasing strategy needs regular review over time. Because of steadily changing border conditions in our markets and our organizations this procedure is inevitable. Let me be clear on this point: the way to create and review strategic actions shall be as standardized as possible – this will focus the responsible team rather to the content than the way how to achieve the implementation of strategy.

The strategy chapter contains the following points to work on:

·      stakeholders

·      requirements/needs of stakeholders over the time

·      social, political, ethical context the business works in

·      risks

·      opportunities

·      communication

·      governance

Relation with next management level

To mirror these general strategy relevant points against the purchasing organization especially the point stakeholders needs further definition. The purchasing organization is usually placed in-between suppliers (external) and the own organization (internal). Triggered by the kind of transactional content and complexity many stakeholders may have interest in the related business. Due to this fact it may require an extended effort to find all the requirements for reference in the final strategy setup. Stakeholders in the purchasing process are usually:

·      ordering units

·      quality management

·      product project leaders/teams

·      controller

·      corporate governance (sustainability, compliance, communication)

·      supplier base

·      OEM – customer

·      …

All the other points referenced are more straightforward purchasing process oriented. Most of these points can be worked on with a comprehensive SWOT analysis workshop. Basic key information for this session is the Vision Statement and the requirements list of all the stakeholders. The goal for a perfect visionary workflow is always an organization that has all major processes identified and keeps them streamlined. Further on the processes are reviewed in a regular interval and optimized when applicable. Consequently, a perfect purchasing strategy process is pursued with a process base in a regular or continuous way. Once implemented the workflow is clearly defined and shall not cover too many resources. These newly implemented or redefined processes might be:

·      Service customer surveys or interviews

·      Supply Market analysis

·      Category reviews

·      Market and process innovations analysis

·      Risk management routines

·      Setting of objectives

·      Policy deployment

·      Regular review process

·      …

All these processes shall be well adapted to the business to unfold an efficient strategy development. Once the strategy process is set-up, further support for all the other enablers (people,ressources and partnerships, leadership) can be put into operation to develop a sustainable purchasing system.

Bernhard Rau, Werdohl 27.2.2017