There are countless challenges in the Procurement area of a company. One of these challenges is the need to reconcile the demand of internal customers (who request the purchase of products and services) with the availability of suppliers (who are not always able to meet the required deadlines and specifications).
Imagine the following situation: the Logistics area of a large company urgently needs to conduct a project to expand the capacity and efficiency in the distribution of products in a region, as the volume of goods sold has increased sharply due to the entry of new product lines. Thus, the company's Director of Logistics wants to hire a consultancy to assist him in this project, and asks the Procurement area for help in selecting the best consultancy options with their respective budgets. The pressure to complete the work quickly means that the Logistics area wants proposals from candidate companies within 3 days. However, the Procurement area understands that this type of contract is complex and takes longer, as it is not a common request, requiring great validation of the quality of suppliers, in addition to numerous interactions to specify the scope and customization of proposals by suppliers, with subsequent need equalization of proposals so that budgets are comparable.
In fact, the contracting process for services and projects is usually much more elaborate than the purchase of standardized products or services (such as basic raw materials and typical services such as cleaning or painting).
In this sense, it is the role of the Procurement area to understand that the speed of choosing the supplier is crucial for the Logistics area, but at the same time it is necessary to negotiate internally the deadlines required by the internal customer, because if the project specification is not well , or if the selected consultancy does not have the necessary qualifications, the result of the contracted project could be bad for the company.
For those who are familiar with the classic Kraljic matrix, they know that complex and customized services with a high financial impact for the company can be classified as items selection. Hiring these services requires more elaborate work or long-term partnerships with suppliers that have proven their quality.
For those who want to learn more about the challenges and techniques for managing purchases and supplies, ILOS regularly offers face-to-face classes of the course “Strategic Supply Management”, in addition to the online course “Procurement Process".
References:
Last Mile Challenges: Vacancies and Traffic
ILOS Reports Urban Last Mile Challenges and Solutions
Maria Fernanda Hijjar
https://ilos.com.brManaging Partner of ILOS, she holds a master's degree and a bachelor's degree in Production Engineering from the Federal University of Rio de Janeiro (UFRJ). With over 10 years of experience in Logistics and Supply Chain, she has worked on various projects, managing and participating in research related to the topic. She has published more than 20 articles in newspapers, magazines, periodicals and conference proceedings, and is co-author of several titles in the COPPEAD Collection published by Atlas and in the ILOS and CEL/COPPEAD Logistics Panorama Collection.
