What Is a Procurement Manager?
Procurement manager is a position commonly found in medium to large organizations. Procurement is another term used to describe purchasing activity conducted on behalf of the organization, or business to business purchasing. The types of commodities, services, and products purchased vary widely, based on the primary business of the organization. For example, a school board's purchasing activity will be primarily consumable products, such as books, paper, and related supplies. A manufacturing firms purchasing activity will focus on raw materials, equipment, and services.
The primary responsibility of a procurement manager can be divided into three categories: policy compliance, coordinating procurement activities, and supervising procurement staff. Many procurement managers are promoted to this position based on their experience as a procurement officer. This type of career progression encourages other employees to provide their best performance to the firm, while maintaining valuable organizational history and memory. A solid understanding of current business processes, policies, and contract law is very important in this job.
Policy compliance is one of the most important responsibilities of a procurement manager. The procurement policy of the company or organization is designed to protect the company from legal challenges, while obtaining the best possible combination of price, quality, and service. Ensuring that all the departments and staff that are purchasing materials and services on behalf of the firm are following these guidelines is critical.
The coordination of procurement activities across the organization depends on the structure and role of the procurement department. For example, in a decentralized organization, each department can make its own purchases. Coordination in a decentralized environment requires training, documentation, and oversight reports from the purchasing or accounting system.
In a centralized organization, all requests are funneled to a staff of dedicated procurement personnel, who report activity to the procurement manager. In this structure, procurement professionals are often organized by commodity grouping, allowing them to easily identify opportunities for group buying and to ensure there is compliance with policy regarding the issuing of RFP’s over a specific dollar value.
Supervision and staff management duties typically include daily operational supervision, human resources issues, and performance reviews. The operational efficiency of the department is typically evaluated based on turn-around time, quantity and total value of purchases, customer service, and total dollar value saved. In most firms the procurement department is part of the controller or vice president of finance portfolio. As a result, metrics and annual financial statement information is used to evaluate the effectiveness of the department and the level of value added to the organization.
Written by Carol Francois
