The role of a procurement manager can be compared to the roles of operational, tactical, and strategic buyers. Here is an explanation of each of these roles and how they relate to one another:
Procurement Manager
A procurement manager is responsible for the overall management of procurement activities within an organization. This includes strategic planning, coordinating the procurement team, supplier management, cost control, and ensuring efficiency and compliance with procurement policies. The role of a procurement manager is often more overarching, overseeing both tactical and strategic procurement activities.
Operational Procurement
Operational buyers (or procurement officers) focus primarily on day-to-day procurement activities. Their responsibilities include:
- Placing purchase orders and following up on orders.
- Ensuring timely delivery of goods and services.
- Resolving issues with orders, such as incorrect deliveries or quality problems.
- Communicating with suppliers regarding specific orders and deliveries.
Operational procurement is focused on the execution and transactional aspects of the procurement process, ensuring that the daily needs of the organization are met.
Tactical Procurement
Tactical buyers operate at a level between operational and strategic. Their responsibilities include:
- Analyzing procurement data and trends to make better purchasing decisions.
- Negotiating prices and terms with suppliers for short-term contracts.
- Evaluating supplier performance and maintaining supplier relationships.
- Implementing procurement strategies developed by the procurement manager or strategic buyers.
Tactical procurement aims to improve the efficiency and effectiveness of procurement activities in the mid-term.
Strategic Procurement
Strategic buyers focus on the long term and on developing procurement strategies that support overall business objectives. Their responsibilities include:
- Developing and implementing procurement strategies that align with business strategy.
- Analyzing market trends and anticipating future needs and risks.
- Building and maintaining strategic partnerships with key suppliers.
- Identifying opportunities for cost savings and process improvements in the long term.
- Negotiating large and long-term contracts with suppliers.
Strategic procurement aims to create value and competitive advantage for the organization through long-term planning and strategic decisions.
Summary of the Differences
- Procurement Manager: Overarching management of procurement activities, including strategic planning and coordination of the procurement team.
- Operational Procurement: Daily execution of procurement activities, such as placing and following up on orders.
- Tactical Procurement: Mid-term improvements and negotiations, evaluating supplier performance.
- Strategic Procurement: Long-term planning and development of procurement strategies, building strategic partnerships.
Each role contributes to an efficient and effective procurement process at different levels within the organization, with the procurement manager ensuring the integration and coordination of these roles.