One of the crucial activities in an organization is the procurement function which must be conducted effectively and efficiently. Companies are beginning to understand the potential that their supply chains and procurement divisions contribute to their profitability. Effective procurement helps to streamline processes, reduce raw material prices and costs and identify better sources of supply, thus improving organizational efficiency.
Report from Florida-based Hackett Group says through the deployment of digital tools, procurement organizations can reduce operational costs by up to 45%, achieving efficiency levels while at the same time enabling them to improve effectiveness and customer experience.
Hence, procurement has become one of the most important functions of an enterprise. The following 5 important functions are mandated to be executed by the procurement department: