The procurement professional part 2

contract negotiation, supply chain infrastructure, and outsourcing models. Getting the right mix and delivering optimum savings is a mixture of art and science. The procurement professional should acquire these skills.

Contract management skills:

Contract management is not just about Contract drafting. Some people assume they are contract management experts simply because they are lawyers. However, the reality is that contract management goes beyond contract drafting and interpretation. It involves monitoring the development, signing off and implementation of contracts as part of the foundation for a successful supplier relationship. It also requires technical knowledge of risk analysis and management, data analysis and commercial skills. These skills are vital for procurement professionals as they allow you to ensure that the initial benefits agreed in the contract are maintained throughout the contract life.

Understanding of total cost of ownership:

Total cost of ownership (TCO) is a financial estimate intended to help buyers and owners determine the direct and indirect costs of a product or system. It is a management accounting concept that can be used in full cost accounting or even ecological economics where it includes social costs. TCO has been adopted in Procurement profession to enable buyers in their cost computation in the contract process. By focusing only on bestlanded cost, your organization can achieve a very short- term benefit of buying something as inexpensive as possible. However, this myopic Purchasing practice can be very expensive in the long term. There is a difference between value and pricing. TCO looks at the value rather than price. Therefore, other variables such as warranty cost, costs due to adjustment of production schedules and so forth are recognized by TCO and therefore, professionals are expected to acquire TCO skills.

Risk Management is the identification, evaluation, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability or impact of unfortunate events or to maximize the realization of opportunities. In procurement practice, we consider three key categories of risk among others namely: operational risks, commercial risks and legal risks. Documentation is a major mitigation for risks in procurement. A successful procurement practitioner is expected to be skilled adequately in risk analysis and risk management in order to add value to the organization.

It is instructive that these skills and qualities of the procurement professional as discussed here are not exhaustive. Some other skills required include Integrity, which is a combination of good character and morality; Knowledge and organization skills; Forecasting skills; Entrepreneurial skills; Collaborative Attitude/behavior skills; A balance of quantitative and qualitative analytical skills; Attention to details; Creative solutions skills; Time Management skills; as well as Capacity to learn new techniques and approaches.

These skills can be learned through training or on the job development to secure your future as a sought after procurement professional. They are both qualitative skills and quantitative skills and some are even behavioral skills. It is pertinent for the

Risk management skills:

professional to realize that these skills which in themselves impact on their general performances are a must have. We have situations in some organizations where some people are drafted to procurement and Supply Chain departments from other professional backgrounds and they assume that they do not require further training in the new field. This is not right. For any practitioner to add value to the procurement practice, he needs to internalize the culture, values and competencies of the profession. These are acquired through formal training and on the job development. Organizations must insist on every practitioner acquiring the minimum competencies required by the procurement profession.

In conclusion, Procurement practice as a profession has come a long way. We are fast creating a distinct identity in organizations gaining recognition even at Executive Management levels in many organizations. We are therefore, building a team of professionals across all industries both in the private sector and public sector of the economy. To this end, Chief Procurement Officers must continue to insist on hiring and retaining individuals whose training and professional development are consistent with our professional goal of entrenching world class procurement departments with the right staff equipped with requisite skills. Our processes and procedures must be regularly updated and simplified for use by our well trained and motivated procurement professionals.