LEAN PROCUREMENT

#SUMMARY.TUE 08102019. LEAN PROCUREMENT

LEAN PROCUREMENT

Lean procurement is becoming a strategy method for gaining competitive advantage and even for survival, not just for manufacturers, but also for service companies since adding value and removing waste is no longer an option for companies.

Procurement is the acquisition of goods or services. It is important that the goods/services are appropriate and that they are procured at the best possible cost to meet the needs of the purchaser in terms of quality and quantity, time, and location. Purchasing is any activity for which the organization receives an invoice from an outside party while procurement includes all activities in order to get the product from the vendor to its final destination (Van Weele, 2009).

Methodology:

 This procurement methodology empowers multiple levels of the organization to help attain its goals (such as project-based procurement). It can yield significant results. Based on several case studies, on average the benefits would be (Nicoletti,2012):

1. cost reduction between 20 and 40 percent;
2. speedier responses to the need of the business; 
3. more flexibility; 
4. a wider range and pool of talents from outsourcing organizations; and 
5. reduction of risks with the vendors  

The first phase of the method would be the define, the main steps in this step are:

(1)    define in detail the process and the problems which we want to improve;

(2)    define the macro-objectives for the initiative;

(3)     set up the team which will go through the application of the method;

(4)     assess current environment (vendors, organization, logistics, processes);

(5)    define product/service requirements (current and expected);

References:

Kabuga, M. W. (2012). Lean procurement methodologies used by large scale manufacturing firms in Nairobi.

Lean Six Sigma and digitize procurement Bernardo Nicoletti Master in Procurement, Universita` di Roma Tor Vergata, Rome, Italy

MINIMIZATION WASTE EFFORTS ON PROCUREMENT PROCESSES
GOODS / SERVICES IN PT PERTAMINA HULU ENERGI (PHE)
USING LEAN SERVICE, Bobby Cahyo Widiantoro PT Pertamina Hulu Energi, Jakarta