What is the logic of the internal client? Where to look for answers about where and how to buy a required product, in what quantities, when it should be delivered, but also what should actually be purchased? – Trivial as it may seem, the last question is very important. To a large extend, answers to the above questions depend on the effectiveness of the buyer and savings he/she is able to generate.
Who is the internal client?
In the case of mature purchasing organisations, different corporate structures should be analysed as internal clients. Assuming that the purchasing organisation is functioning across the structure, as a matrix, the interests of all internal clients should be defined. It is necessary to identify and combine the requirements of each internal client with the current operations of the company. Naturally, managing the relationship with the internal client in a conscious and constructive manner – based on the reporting or current survey on the quality of relationship– should not be disregarded. It has to be remembered that the internal client is not only a professional organisation – the one that requires particular products or services – but also includes the management, purchasing department employees, other managers, whose work and evaluation affect the perceiving and quality of activities conducted by purchasing departments. Finally, the cooperation with the supplier – who should be treated similarly to the internal client – is also of great importance.
Remember about suppliers!
To build an effective purchasing team, it is also necessary to remember about suppliers, because they have the most knowledge about the product, market conditions and new technologies. With sufficient involvement, partners may share this knowledge with each other. Another source of support in the purchasing-organisation relationship may be the supplier who should be treated as an internal client. However, it requires great maturity of the organisation to establish this kind of relationship with a supplier, the organisation has to be very mature. Otherwise, there is a risk that the specification will be monopolised, which is a natural tendency on the supplier’s part. In addition, the buyer has to be able to ask the contractor appropriate questions about: why it recommends a particular product, can the product be replaced with something else, and finally is it economically reasonable, considering the TCO.
Work on communication… and generate value
A well-planned approach to communicating the needs and purchasing couching of the internal client should be a multistage process based on ever-day work between the buyer and the engineer. However, it is not the buyer and the engineer who generates value in the entire process. The organisation should remember about the external environment of the purchasing operation – the product, financial and legal market. Such knowledge is obligatory for carrying out individual processes. However, we cannot expect the buyer to be a brilliant and tax specialist at the same time. Instead, the buyer should know at what stage and who has to be involved to provide this knowledge, and if it is not available within the organisation, it may be delivered by external providers.
Above all, the buyer has to be an excellent organiser, facilitator, and a kind of couch. Professional knowledge is necessary for asking questions about why and how a particular product should be purchased. To expect that the buyer will specialise in, for example, valves, is an exaggeration (this is the field of the internal client who should share his professional knowledge), but definitely the buyer should know who sells them, what affects the prices, whether the supplier is reliable or not and what other options are available in the market.