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Week of 12 June 2023: Let's talk about Purchasing, Part 2

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Today's purchasing professionals are much better than the ones I ran into early in my career, but there is still room for improvement. A great purchasing executive must be a strategic and tactical thinker, also keeping their company's ESG goals in mind.

At one time, in a very large company, I headed a team responsible for choosing new process system components for the entire company. This included standard valves, special valves, fittings and other appurtenances that are attached to piping. I was all of 25 years old. Fortunately, I was too naïve to be corrupted, but I often wondered what management was thinking to put such responsibility on me.

Now, I wasn't in a vacuum, managerially speaking, I reported to a process systems steering committed (and was also their secretary). But the way to that committee was through me.

The key in that company is that the process systems steering committee, including me, were all engineers. Once we approved an item, we sent it to purchasing to place it on the approved list. And purchasing did not buy anything anywhere on the company for process systems without checking our approved list first.

This was before the ESG concerns of today. We found a valve that would work in most simple water services that was about half the price of the competition. However, a wise senior member of the steering committee asked an important question. Where was it made? Turns out it was made half a world away in a forced labor factory. It never got on our list.

Now, in that company, we had extensive resources and could handle such matters expeditiously.

In a one mill company or in even a slightly larger company, if you are the purchasing executive, you may be wearing many hats of responsibility. I would encourage you to not think solely about price, terms and conditions. Your responsibilities are much bigger than this.

Set high standards. Cultivate your local resources. Build your own full mill team of helpers, meet with them as a team occasionally and draw them in specifically on unusual purchasing issues and decisions.

Don't be a mystery department behind closed doors as has often been the case in the past. You have an important role to fill when it comes to preserving and improving the viability of your mill.

Be safe and we will talk next week.


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