There is no doubt that procurement plays a critical role in business. However, procurement is often a neglected part of business. Perhaps because we all purchase for our homes and so take for granted procurement for the value creation process. Procuring for value creation requires strict accountability to the business owner; be it private or government. In the past manufacturers grappled with their costs amid all the inefficiencies, added a margin and were still able to sell.
However, technological advancement, fierce competitive and demanding customer taste have placed limitation on the price the market can take; implying pricing strategies have changed from cost-led pricing to price-led costing.
Businesses are therefore forced to take this price ceiling and work on their cost for an appreciable margin in order to survive; failing which businesses risk extinction through natural selection. The topic for the Pan African Conference- ‘the strategic role of professional procurement in the development of Africa’ drives home once more the import of procurement in corporate and national prosperity. The conference could not have come at a better time than now when this country, in pursuit of a ‘Better Ghana Agenda’, is redefining its frontiers in the ever-changing world of business.
The truth is that good sourcing leaves money for the business by way of savings for research, business and social infrastructure development to improve the lives of our people and good returns for business owners. The need for professionalism is underscored by research to explain the reason some countries do better than others in international trade. Why does Africa treasure professionalism in accounting, medicine and engineering? Why in architecture, marketing, insurance but not in procurement? It is about time high performance standards were set for procurement people so they can be held accountable, in line with the axiom ‘what gets measured gets done’. Another area of neglect in procurement is the Store/Warehouse function.
Simply put a congested warehouse connotes ‘waste’ which is passed on to the consumer. It is about time the ‘5S’ concept was strictly enforced in our store set-ups. That procurement is in complete jeopardy if we fail to get this right. Professionalism in procurement is a ‘must have’ if Africa wants to rub shoulders with the rest of the world. In this time of nation building and fierce competition, the profession Africa needs mostly is procurement because procurement holds the future of business. The stone that the builders rejected, the scripture says has become the head of the corner.
Africa needs professionalism in procurement to continue to attract foreign investment or wean herself from foreign investment.
BY: DELA AGBO