Defining a procurement strategy and the operationalisation thereof.


A defined procurement strategy, standardised protocols and processes, governance and systems to support procurement.

1. Problem Statement

  • The central theme of this solution is to shift from a buying culture to a sourcing culture through the introduction of standardised protocols, processes, governance and systems to the operational procurement of the company.
  • The goals are to:
  • Reduce risk (standardised work, rationalise product and suppliers, contract management);
  • Reduce cost (improve operational capacity, optimise efficiency, online P2P system);
  • Increase quality (increase visibility through BI, quality metrics, people development);

2. Solution Approach

  • Create organisation wide collaboration – currently only between suppliers and business unites, central procurement department excluded from the process (includes supplier selections, orders and deliveries).
  • Create governance to select and review suppliers (enforces optimum cost and service).
  • Create visibility on indirect expenditures using BI:
  • Define expenditure categories;
  • Improve processes for master data management (adding new suppliers and materials);
  • Re-design procurement process.

3. Project Outcomes

  • Improved the procurement capability maturity of procurement within the company;
  • Define roles and mandates of functional areas and enforce collaboration;
  • Define and improve business processes:
  • Procurement operations;
  • Data management;
  • Create visibility and rationalise the expenditure categories:
  • Vendor/supplier management;
  • Expenditure tracking;