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    CHPT 3 Question 5 Hybrid Structure of A Procurement Function

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    CHPT 3 Question 5 Hybrid Structure of A Procurement Function

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    Chpt 3 Question 5 Hybrid Structure of a Procurement Function

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    CHPT 3 Question 5 Hybrid Structure of A Procurement Function

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    obediomm

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    Question 5, L4M1 Chapter 3 assignment

    Hybrid refers to the mixture of both centralized and decentralized structure .In a hybrid
    structure of a procurement function, the roles of local procurement teams and central
    procurement teams can be distinctly defined, each contributing to the overall procurement
    strategy and effectiveness. According to the Chartered Institute of Procurement & Supply
    (CIPS), here’s how these roles typically break down:

    (i) Local Procurement Teams.

    1. Compliance and Policy Adherence:


    o Ensure compliance with corporate procurement policies and guidelines while
    addressing local nuances.
    o Conduct procurement activities within the framework established by the
    central team.
    2. Performance Monitoring:
    o Monitor supplier performance at the local level and provide feedback to the
    central team on issues or opportunities for improvement.
    3. Stakeholder Engagement:
    o Collaborate closely with internal stakeholders to identify needs, gather
    requirements, and ensure alignment with procurement strategies.
    4. Operational Procurement:
    o Manage day-to-day purchasing activities for specific departments or business
    units.
    o Handle local sourcing of goods and services based on immediate needs.
    5. Supplier Relationship Management:
    o Build and maintain relationships with local suppliers to ensure reliability and
    quality.
    o Engage in negotiations and contract management for local agreements.
    6. Category Expertise:
    o Develop expertise in specific categories relevant to their business unit,
    understanding market conditions and supplier capabilities

    (ii) Central Procurement Team

    1. Strategic Procurement:
    o Develop and implement the overall procurement strategy for the organization.
    o Identify and prioritize strategic sourcing opportunities across the organization.
    2. Policy and Framework Development:
    o Establish procurement policies, procedures, and guidelines to ensure
    consistency and compliance across all local teams.
    o Create standardized templates and tools for use in procurement processes.
    3. Risk Management:
    o Assess and manage procurement risks at a strategic level, developing
    mitigation strategies for potential supply chain disruptions.
    4. Training and Development:
    o Provide training and support to local procurement teams to enhance their
    capabilities and ensure alignment with central strategies.
    5. Supplier Management:
    o Conduct supplier selection and qualification for key strategic suppliers.
    o Manage long-term supplier relationships and oversee supplier performance
    metrics.
    6. Category Management:
    o Implement category management practices to optimize procurement across
    the organization.
    o Analyze market trends and leverage buying power for better pricing and
    terms.
    7. Data Analytics and Reporting:
    o Utilize data analytics to monitor procurement performance, track savings, and
    report on key metrics to senior management.

    In summary, local procurement teams focus on operational execution and supplier


    management within their specific areas, while central procurement teams are responsible for
    strategic oversight, policy development, and overall organizational coherence in
    procurement activities. This hybrid approach allows for both localized responsiveness and
    centralized control, optimizing the procurement function across the organization.

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