Principles and Practices for Orchestrating Digital Value Chains

Procurement did in the past not always receive the management attention it should. This situation has changed in many organisations, but I wonder whether the potential added value of the procurement department / function is fully used yet. What I try to explore in this post is finding out what the enablers are to unleash the full potential of procurement. I have for example seen situations where the business engaged in (out)sourcing without (hardly any) involvement from procurement. Some of my thoughts to change this are: Organise procurement as a process, not as a function If one would define procurement as: is ‘the total of activities and performed in order to effectively and efficiently provide the organisation with all products and services it needs to perform deliver its endproducts and –services to its customer’ than procurement is something that does not stop at the boundaries of a department. It would be a process consisting of a number of activities, clustered in processes, w...

One of the returning topics when I talk with people about ‘outsourcing’ is what the difference is with ‘purchasing’. The short answer is that the typical purchase officer a) focuses to much on $$$ and b) lacks the required knowledge and skills that sets outsourcing apart from buying pencils and the light bulbs.My search for a more comprehensive answer resulted at first in the following quotes: Procurement : ‘obtaining from external sources all goods, services, capabilities and knowledge necessary for running, the company’s primary and support activities (Weele, 1995) Outsourcing : ‘refers to the process whereby activities traditionally carried out inside the firm are contracted out to other organisations’ (Domberger, 1998). Sourcing : ‘finding sources of supply, guaranteeing continuity of supply, ensuring alternative sources of supply, and gathering knowledge of procurable resources’ (Vollman et al, 1984). I don’t know about you, but it did not help me all that much. It is still too mu...