Building a State of the Art Purchasing Department

An industrial customer with a worldwide footprint was struggling to meet it gross margin targets. The performance of the Purchasing Department was identified as one key levers to correct the situation.

A program was launched to bring the function up to “Best in Class” standards. The goal was to significantly improve the annual savings and to implement a structure, processes and procedures that would enable the function to deliver consistently high performance into the future.

With our systematic approach, we set up a program with 4 main modules: Methodologies, Supplier Management, International Sourcing, Processes and Structures. Each module was approached in 3 steps: Analyse, Close the Gap and Stabilize. This approach ensured that we took the clients team step by step through the process and allowed the best possible know how transfer and training.

After completion of the project, the purchasing function was restructured with globally responsible lead buyers for each commodity. The staff was trained in state of the art methodologies and clear procedures and processes in place. The annual savings on the variable costs increased year on year after implementation.