The head of procurement oversees all aspects of her company’s purchasing operations. She generally provides final approval of what each department buys to sustain daily operations. This may include acquisitions as small as paper clips up to large capital goods purchases, such as vehicles, heavy equipment and production machinery and tools. Procurement requests also regularly include intangible purchases such as vendor and service contracts. Operating expenses, along with maintenance and repair costs, also often require the authorization of this person.
When considering purchase requests, the head of procurement generally must contemplate a variety of factors. Other than simple budget constraints, she must take into account a department’s past performance and whether they properly and efficiently used the funds that were approved. Typically, she must analyze needs over wants and consider long-term repercussions of her decisions to approve or deny purchase requests. Whenever a denial of funds occurs, the head of procurement is commonly required to justify her decision.
Based on the intricacies of many of the requests, being the head of procurement often requires the ability to accurately interpret contracts and determine their long-term or less-apparent implications. Solid knowledge of contract law can be very helpful, as can familiarity with the reputations of the companies and entities involved. A person in this position considers facts as well as more ambiguous implications in making her financial allotment decisions.
Depending on the nature of the business, a person in this position may have to consider many factors of a procurement requests. These issues can include reviewing different grades and types of requested materials to determine what choices are most cost-effective without compromising quality. Analyzing pricing trends that may affect the timing of purchases can also be part of the job, as well as reviewing national and regional policies and procedures that could influence procurement decisions.
If the head of procurement works for a firm with numerous branches or subsidiaries operating under a common corporate authority, bulk or cooperative purchasing may be necessary. This would require the procurement head to confer with department heads to ascertain if a very large purchase of goods or services would be lucrative. She may also communicate with key personnel on alternatives in purchasing that may save money. These options may include using recycled materials or alternate energy sources that could present savings in the form of tax write-offs or rebates that offset the initially higher purchasing costs.
Requirements for a head of procurement position vary by company. In general, a background and a degree-level education in accounting, along with having an excellent understanding of procurement accounting methods, is helpful. No other specialized training or education generally is required. The most important consideration is a verifiable background in discretionary purchasing that demonstrates good judgment and fiscal responsibility.
