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Types of procurement

Take a look at the two types of procurement along with the key challenges’ procurement professionals are facing today

What are the different types of procurement?

Procurement can be split into two different types, direct and indirect procurement.

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What challenges are procurement facing today?

Procurement professionals are facing ever-increasing challenges to keep up with market changes. Procurement professionals need to be resilient to change and be able to adapt to new technologies that aim to drive efficiency within procurement. Take a look at some key challenges that procurement face today.

  • Risk management:
    These challenges consist of financial stability of critical and high-spend suppliers, reputational damage, data protection, supply chain certainty, bribery, and corruption.
  • Sustainability:
    These concerns are of global interest and include ethical and sustainable sourcing, prevention of bribery and corruption, modern day slavery, reduction of energy and C02 emissions.
  • Diversity:
    Procurement need to establish a level playing field for diverse suppliers as this encourages innovation. However, it’s a challenge to identify those suppliers that meet the diversity criteria, particularly if there is no mandatory policy.
  • Stakeholder management:
    Procurement professionals need to be equipped with the right skills to communicate with stakeholders, as it’s critical to the success of procurement projects. Soft skills are increasingly becoming more important to help build up trust and rapport to establish long-term supplier relationships and buy in within the procurement process.
  • Digitalisation:
    As technology evolves, there’s an ever-increasing number of systems to improve efficiency. These can be cloud-based applications, robotic process, and data visualisation tools. As we gradually step away from traditional manual processes, procurement professionals need to have the right skills to embrace digital and adapt to their ways of working.
 

What is procurement?

Procurement involves the buying of goods and services that enables an organisation to operate their supply chains, in a profitable and ethical manner. Explore deeper into how procurement is defined, the role it plays and a how a career in procurement can benefit you.

Procurement key themes

Procurement process Procurement Specifications Procurement policies Direct - Indirect Socially responsible procurement
How to write a contract eProcurement Innovation cycle Procurement supply cycle
Public sector Big data in procurement What is procurement Procurement KPIs

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