Tactical vs Strategic Purchasing

Most purchasing departments aspire to be "strategic." They seek to minimize their tactical tasks and spend more time on strategic ones. Here are 10 characteristics of strategic, in contrast to tactical, purchasing :

Spend Analysis: Strategic purchasing teams examine the amount of money they spend in each category of goods and services and use this analysis to identify opportunities for improvement.

Supplier Relationship Management: Strategic purchasing teams measure supplier performance and regularly spend time meeting with their most important suppliers to implement improvements.

Technology Implementation:


Strategic purchasing teams frequently update and add technologies that measurably reduce costs, decrease cycle time, and make the purchasing process more efficient.
Developing Project Plans: Strategic

Enterprise-wide Contracts: Strategic purchasing teams consolidate spend across all parts of their organizations and enter into contracts with a limited supply base to serve the needs of the entire organization.

Forecasting: Strategic purchasing teams regularly document changes that they

foresee in price levels, availability, and markets to ensure a competitive advantage for their organizations.

Involvement in Spec Development: Strategic purchasing teams are involved at the early stages of specification development, lending specialized knowledge in material availability, cost drivers, standard parts, and reliability of supply.

Development of Productivity Tools: Strategic purchasing teams develop tools


(e.g., RFP templates) so repetitive tasks can be done more quickly and error-free.

Supplier Development: Strategic purchasing teams don't blindly accept the suppliers and products that are currently available. They work with suppliers to develop new capabilities or products that will improve cost or quality.

Work Responsibility Refinement: Strategic purchasing teams constantly identify ways to automate, delegate, or eliminate tactical, non-value-added work.


 Articles on Materials Management.....

Management's expectations From Purchasing
Crisis in Purchasing & emergency Planning

Negotiation Questions from suppliers that can Surprise you
The Supplier Code of Conduct
Entering into a Time and Materials Contract
Supplier's bid Comparison Formula
Supplier Diversity Program
Determinants of a Modern Purchasing Department
Negotiating With Suppliers Over their Policies
Procurement Project Management Plan
The Purchasing Risk Analysis
Inventory Audit Checklist
Hazards Of Purchasing profession
Tactical vs Strategic Purchasing
Demystifying Group Purchasing Organizations
Suppliers' Secrets For Negotiating With Purchasing
Cost Savings Reporting: Dot Your I's!
Code of Ethics in Purchasing
Six Sigma to Success