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Strategic Procurement

1) What important differences exist between order placing and a strategic procurement role?

2) For anyone that's worked on a cross functional team, departmental conflict is nothing new. Discuss issues that might exist between the Engineering and Purchasing departments as the responsibilities and level of integration increase for the procurement role. One of my pet peeves is when engineering solicits quotes for the sake of expediency without the proper documentation, including terms and conditions. Accepting these quotes and placing a PO puts the organization at a disadvantage when there are discrepancies in the terms and conditions. Can you think of any other types of conflict, either constructive or destructive?

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1) The important differences between order placing and a strategic procurement role, is that order placing is nothing more than choosing to place an order with a specific vendor. The Strategic procurement role on the other hand, manages the relationship with "approved" vendors with whom the procurement has established a master agreement under which both the vendor and the customer benefit by working together. Example would be a difference between placing an order from a "mom's and pop's corner shop" for a certain amount of computer equipment (that might or might not be the cheapest price), versus placing an ...

Solution Summary

This solution explains the important differences between order placing and a strategic procurement role. Furthermore, the solution discusses the issues that might exist between the Engineering and Purchasing departments as the responsibilities and level of integration increase for the procurement role. One of my pet peeves is when engineering solicits quotes for the sake of expediency without the proper documentation, including terms and conditions. Accepting these quotes and placing a PO puts the organization at a disadvantage when there are discrepancies in the terms and conditions. Can you think of any other types of conflict, either constructive or destructive?

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