What #pacesetter means for the Procurement Organization

The path to the digital end-to-end supply and service chain leads via a procurement department that acts in a Value Added Network (VAN) with all participants – oriented to the process and detached from departmental and product group barriers. When procurement acts in a VAN, it simultaneously becomes a pace-setter, a #pacesetter, for the company and thus fulfils the claim that the BME created with its headline for the BME Symposium 2019 from 13 to 15 November in Berlin.

Bye, bye Product Group, hello VAN

Up to now, procurement structures have been primarily oriented towards product groups (lead buyer structure), subdividing procurement into centralized and decentralized activities, into operational, tactical and strategic tasks, and distinguishing between disciplinary and technical roles. In VAN, on the other hand, criteria play a role that are becoming increasingly important in modern companies. For example, increasing networking, end-to-end considerations, agile working methods, an innovation-promoting environment (error culture, creative spaces, new work) as well as digitization and the possibilities of artificial intelligence. All this must be taken into account when designing a sustainable procurement organization.

How do we want to work together?

Agile approaches organize the people around the work and not the work around the people. This means that the focus is on the business process and its optimal implementation, around which procurement is organized. In the VAN, the Collaboration Area defines how and in which agile structures procurement should work together. Here, buyers can determine in which areas they will continue to work in classic structures, which tasks cross-functional teams will take care of and which sub-processes will be covered by product owner in an agile approach. The result is a structure that adds value.

More Speed through digitized Sub-Steps

One thing is clear: The networking of procurement with its internal customers, suppliers, pre-suppliers, pre-suppliers and suppliers will achieve a complexity that can only be mastered and managed with the simultaneous digitization of many individual steps. Procurement therefore urgently needs to invest in digitization and networking.

Procurement as Owner of a Digital Supply Network

The different models of cooperation will be traditional, agile or hybrid. The challenge will be to harmonize the individual levels (digitization, organization, collaboration) within the Value Added Network, because they build on each other at the same time. Procurement then acts as a spider in a digital network and becomes the owner of a digital supply network. Procurement thus becomes the pacemaker for the entire organization.
Questions & remarks? We are at your disposal at the BME Symposium!
Joachim Lüninck and Lorenz Kleinert as VAN experts at the BME Symposium from 13.11-15.11 will be happy to assist you as sparring partners and idea providers. Feel free to contact us.

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