The key drivers that determine the shape of the procurement team (organisational models) are determined by analysis of the following: The Local Government How well does the Local Government collaborate across Business Units? To what extent is centralisation/decentralisation preferred for service functions? What is the intended culture of the organisation? Supply Market Shape and Action Are the supply markets regional or How are the suppliers organised in managing accounts industry focus, geographic focus, product/service focus? – Suppliers What is the level of supplier concentration? Are opportunities for consolidation of expenditure? What is the complexity and risk of expenditure? The core structure of a Procurement team is often defined as either or “centralised” “decentralised”. Under a centralised structure a team of skilled and experienced professionals will oversee the procurement activities of the organisation. Key features: Strong governance Robust compliance Consolidation of spend prominent Low awareness of Business Unit needs; often secondary to corporate or Procurement objectives Detached can lead to poor stakeholder alignment – Can often be inflexible Under a decentralised model a functional and integrated approach is taken towards procurement within respective technical areas. Decentralized organisations empower business units and sites with autonomy and control over supply, process, and technology decisions, as well as sourcing and procurement execution. This structure improves
The key drivers that determine the shape of the procurement team (organisational models) are determined by analysis of the following: The Local Government How well does the Local Government collaborate across Business Units? To what extent is centralisation/decentralisation preferred for service functions? What is the intended culture of the organisation? Supply Market Shape and Action Are the supply markets regional or How are the suppliers organised in managing accounts – industry focus, geographic focus, product/service focus? Suppliers What is the level of supplier concentration? Are opportunities for consolidation of expenditure? What is the complexity and risk of expenditure? The core structure of a Procurement team is often defined as either “centralised” or “decentralised”. Under a centralised structure a team of skilled and experienced professionals will oversee the procurement activities of the organisation. Key features: Strong governance Robust compliance Consolidation of spend prominent Low awareness of Business Unit needs; often secondary to corporate or Procurement objectives Detached – can lead to poor stakeholder alignment Can often be inflexible Under a decentralised model a functional and integrated approach is taken towards procurement within respective technical areas. Decentralized organisations empower business units and sites with autonomy and control over supply, process, and technology decisions, as well as sourcing and procurement execution. This structure improves