Procurement Manager Responsibilities and Tasks
A procurement manager is also known as a purchasing manager and even the head of the purchasing department. If it’s a company that is responsible for making a product or good, the procurement manager must make sure that the company has on hand all of the raw materials, goods, and services that they need—at a cost-effective price—to make the good on time and with high quality.
The Procurement manager responsibilities are plentiful. Quite often, they are in charge of an entire team, particularly if it’s a large company, and their roles go well beyond just buying goods and services to make a product. Some procurement manager responsibilities can be quite intense as suppliers must offer bids so that the procurement manager can pick the best bid for the good or service, with the best interest of his company in mind.
Read on to learn more about the responsibilities that a procurement manager must handle and the most efficient ways to do so.
Methods for Managing Procurement Risks
One part of the procurement process that falls under the cloak of procurement manager responsibilities is assessing and managing risks. There are certainly risks involved in the purchasing process. One of the best things you can do as a procurement manager is to use software to keep track of sourcing, invoicing, contracts, and due dates. With the right processes and tracking, there is no wiggle room for your suppliers and contracts.
However, there are some things, such as price increases, that may be out of your control. In these cases, it’s best to identify the risk, analyze the risk, rank the risk using a risk matrix, and monitor it closely.
If your supplier does give you a surprise price increase, you can always challenge it or ask them to justify it. Alternatively, you can always put language in the contract before signing a contract forbidding this type of increase.
You might also investigate the cost factors that are impacting your supplier to develop a counter-proposal based on the data.
Procurement Manager Responsibilities: Managing Suppliers
Beyond leading your team and being in charge of simple buying and selling, procurement manager responsibilities take on other roles as well. One task includes vendor management in procurement processes. Vendor management is more than simply going back and forth with your vendors through requisitions, purchasing, etc.
The process includes working with your vendors as if they are part of your team to have a mutually beneficial relationship. This involves having some of your dealings (such as your spending) being a little more transparent and visible.
Other important aspects of vendor management include mapping your suppliers through profitability and risk. For example, you can use a simple model to map your suppliers based on these attributes and decide which is best to work with.
Procurement Management Responsibilities: Benefits of Vendor Management
If you feel like vendors are not part of your team, consider fostering a relationship as part of your procurement management responsibilities. There are direct benefits to vendor management, provided that the strategy is executed properly. It allows you to have a shared vision and strategy with your preferred supplier and essentially keeps you on the same page. Also, this allows for shared values, which leads to a shared investment.
If it’s financially beneficial to both, both parties will care more, and the lines of communication will always be open. While the reward is shared, the risk is also shared, which can lessen some of the strain off the back of the purchaser. Overall, it creates good working relationships and trust between companies.