Collaboration Styles of Purchasing Managers

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Collaboration Styles of Purchasing Managers
Koen Vandermarliere, SIG Leader
What collaboration or engagement style(s) you see as most efficient when you're working as a purchasing manager with your internal customers?
  1. Do you approach your customers saying "give me the requirements and I'll do the rest" and come back with a signed contract with the "best" supplier?
  2. Do you discuss the requirements and have your internal customer rate the responses and proceed from there?
  3. Do you set up the requirements and the RFP documents with them and allow them to be present in the presentation of the offer, let them rate the offer and be present in the negotiations?
  4. Or are you supporting them while they are in charge of the RFP project?
What purchasing engagement style do you think works best and why?

Collaboration Styles of Purchasing Managers
Toky SOUDJAY, Member
Our approach is asking requirements, rating criteria from internal user, then launch an RFQ or call of tender depends on complexity, rating answer according to above criteria, negotiating (2 best offers), then approve final decision.

Tapping the Knowledge of Self
srinivas, Member
Before collaborating with others a question to ask oneself is what are the requirements and who - when asked - can add value?
Regarding collaboration, considering divergent points of view may inform us about what is missing in achieving the team’s goal. Each person as part of team is a source of knowledge. Recognizing and respecting that aspect and taking different perspectives by way of respecting others point of view would seem most sensible?

Different Purchasing Approach for Different People
Arvind , Member
I use a different approach for each and every client, because every client is unique and the requirements are also unique. To make the client comfortable with me is the first goal in all the approaches I take.

Government Compliance Rules Apply
Nomi Hattingh, Member
I work in Government, and firm guidance policy and rules apply. At a practical level, I follow the approach in number 3. The client eventually controls the specifications, service level outcomes and project planning outcomes. I contribute forecasting the tender budget, and to risk workshop/analysis, terms and conditions of contract, the pricing tables to tender to facilitate price evaluation and with the value for money assessment. Often I consult technical experts for specifications. I 'chase' the procurement process, making it happen.

Government Rules Apply
Koen Vandermarliere, SIG Leader
@Nomi Hattingh: Nomi, thanks for your reply, how do you prepare the actual public tender part? Do you make a market analysis and use tools like Kraljic, Porters 5 powers, etc to define a purchasing strategy? Who do you involve?

Working Close Together with our Technicians
Dennis Lagerweij, Member
I'm working in procurement of packaging machines within the consumer products business. I work very close with our category technicians and factory project leads. They are the people who can tell me their requirements and if a solution is in line with core design standards. When working on a project we approach the suppliers together, so I can pick up the commercials and they can give the technical feedback.
I also always ask them to check if an offer is fit for purpose and when we compare the various offers if we are comparing apples to apples.

Best Approach of Purchasing Manager
Sandy Musallam, Member
In my opinion option 3 would work best, but without "letting the internal customer be present at the negotiations". Once the requirements and RFQ have been set and presented with the participation of the internal client, the purchasing manager would have everything he needs to negotiate on behalf of that customer.

We Need Less Purchasers
Sven Nyberg, Member
Purchasing is too important to be left in the hands of purchasing managers. Why? Because purchasing management rarely adds value, but more often are bureaucratics obstacles to the overall business goals. Hence most organisations needs less purchasing managers and more bureaucratic rebels. My belief!

An Integrated Cross Functional Purchasing Team
betshanger, Member
In my personal opinion based on past experiences in both the public and private procurement arena option 3 works best when it is also augmented by a cross-functional procurement team consisting of the end-user customer, finance, health, safety, environment and quality. Importantly, while the Purchasing Professional may control the purchasing process itself, members of the cross-functional team must remain an integral part throughout the whole process up to contract close-out stage.

It All Depends;-)
Michael Ameye, Member
In my opinion, it all depends on the company culture, maturity and structure.
I propose a link between the style and a specific environment along the following lines (examples):
Option 1: for highly standardized or recurrent purchases or when the purchasers are experts in the domain (technical purchase)
Option 2: in a more organic company with a purchaser playing the role of facilitator and coach in order to maximize purchase effectiveness
Option 3: when the knowledge comes from the internal client in a collaborative organization (smaller size company or business unit)
Option 4: when the purchaser has more a quality manager or a project manager role and the internal customer needs to be involved at all stages in order to fully cooperative.

Purchasing in a Restricted Market
Belkis Monks, Member
Hi, interesting topic, the structure must be flexible, especially in countries where the access to products and legal requirements can be an obstacle on the road, impacting the process in place, decision making, and effectiveness; in any case the key is to accomplish the goal.
According to my experience, sometimes we have to circumvent the process in place and to adapt to the best option available to achieve the goal. Following are the steps for major purchase/projects, in which the purchase process is managed directly by the purchase agent to speed up the process following internal criteria and approved by the business manager considering quality, price, go green and deadline.
1. Provide the requirements to the suppliers.
2. Present to the internal committee.
4. Internal selection by the committee.
5. Invite all participants selected for presentation to the committed.
6. Internal decision.
Have a great day!

Strategic Buying
Nowadays most purchase manager move to STRATEGIC BUYING where they take the requirements from plant concerns and call the best vendors and place the order.
First identify the requirements and choose the best suppliers and take the decision.

It Depends on the Urgency and Importance of the Items
Roger Vargas, Member
The starting point should depend on the urgency and strategic importance of the project for the internal customer and the organization as a whole:
- STRATEGIC PURCHASES should have a full blown process to follow.
- OPERATIONAL, URGENT (LOW AND MID VALUE) PURCHASES should have an expedited workflow using an automated tool.
- HIGH VALUE PURCHASES (even urgent ones) should have detailed cost / value analysis and committee approvals as part of the process.
If internal customers know there is an expedited workflow, they will try to handle every purchase using it. In this case, a tempting practice is to split purchases to make them appear as low value ones. The purchasing manager should have the skills to detect and prevent this.

It Depends on the Systemic Role of the Items Purchased
Nestor Asto, Member
Different products have different impacts in the operation of the company. This difference comes not only from the NATURE OF THE PRODUCT itself but also from the specific ACTIVITY OF THE COMPANY and the CURRENT CONTEXT (situation of the company and the market).
A consistent purchasing strategy must be clear about the role of the purchasing item for the company and for the entire supply chain. The misunderstandings with internal clients arise from the lack of a common understanding of this role. The Kraljic’s matrix is a very useful tool for this!
Common sense tells us which items are not routine. And even a routine item must be treated differently in special contexts. For very important items the internal client should participate in all the process, but not necessarily taken the final decision. The factors to evaluate for the purchase decision (and their relative importance) must be defined jointly. Then the evaluation of offers must comply with this jointly definition.

How the Tender Develops
Nomi Hattingh, Member
@Koen Vandermarliere:
- For complex or large IT Projects’ procurement: research is done during business case development, and with an 'Invitation to Register Interest' whereat the market contributes information and states what is available. Then the tender document is developed and issued.
- For 'IT Operational' (goods and services) contracts, past material is used, new technology is reviewed and then the tender is developed.

Collaboration Style of Procurement Manager
Ajay kapoor, Member
It is a triangular polygon where on one end we have Suppliers, in another corner we have Internal stakeholders/user function and in the third end the Procurement function/manager. Inevitably during conservations the process sometimes moves to conflict situations.
Hence a collaborative leadership style is one critical competency for procurement leaders to avoid and deal with such conflict situation and to meet organization objectives with high level of responsiveness (TAT) and effectiveness (cost).

Use of Semantic Web Technology for Procurement
srinivas, Member
With the advent of semantic web technology it can be possible to have rules embedded in the software agents and based on the embedded criteria it will collaborate with the related entities in the system, will reason, collate the data and present it to the procurement officer. He then has to use his decisions based on the consciousness since the reasoning part of decision making is already performed by the software agents.It is a possible scenario but the question is how much time it takes?

Use of Technology
Koen Vandermarliere, SIG Leader
@Srinivas: Hi Srinvas, interesting thinking, however isn't this a lot of time and effort and I'm worrying about the reusability of such a development with totally different criteria.
Just like evaluation and Scoring tools it should be developed in a very smart way and easy adaptable to the situation.
Thanks for your reaction. Please keep contributing.

The Level of the Expected Result
Nestor Asto, Member
Many times we discuss about a good purchase without even having defined what we mean with that. Let me explain the idea with an example of real life:
A year ago I went with a cousin to purchase a new refrigerator. We had some idea of what we needed, so we used this idea to discard some models. Finally she had only two models left and could not take the final decision. Then my advice was this “if you cannot decide which of these two is better then probably they are equivalent”.
If the process of evaluation is good enough, then the difficulty to choose between the final alternatives should show that they are almost equivalent. I think that the advice I gave to my cousin is valid also for some internal clients.

The Level of Expected Result
Koen Vandermarliere, SIG Leader
@Nestor Asto: I follow you Nestor, and I believe that setting the requirements right is indeed very important. You need to define your need, by preference before you let a sales representative astonish you with all the additional features and options.
Then it's the evaluation if you want to pay the additional price for the "nice to haves".

The Level of the Expected Result
Nestor Asto, Member
@Koen Vandermarliere: Exactly! And if two or more offers have unexpected features, which the purchaser and the internal client do not consider relevant, those new features should not be taken into account for the final decision.

Conditions and Requirements for any Kind of Collaboration
There are some of conditions and requirement for collaboration effectively in any field,
1. Collaborative governance
2. Instrument and arrangement of collaboration
3. Individual and common (shared) goals who involve in collaboration activity
4. Structure and capacity every individual who collaborate working
5. Commitment and stamina
The last, in centre of collaboration is trust among participants and shifting mindset from individual to collaboration.


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Koen Vandermarliere
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