Basics of Purchasing - Why Purchasing?

Summary

In this engaging discussion, the host interviews Sana, a seasoned purchasing expert with 20 years at Young and a decade at Walmart. Sana shares her passion for the field, emphasizing the continuous potential for development in purchasing. She highlights the evolution from operational to strategic purchasing, focusing on total cost of ownership and risk management. Sana stresses the importance of education, noting a shift towards hiring educated professionals in purchasing. She illustrates how understanding purchasing's value can benefit various company roles, not just purchasers, and the significance of internal collaboration. The conversation underscores purchasing's critical role in business strategy and competitiveness.

Takeaways

• 🌟 Sanna has a rich background in purchasing, with 20 years at Young and 10 years at Walmart, highlighting her expertise in the field.
• 📚 Sanna's motivation in purchasing stems from the potential for development and the excitement of meeting new purchasing teams and their challenges.
• 🚀 Purchasing has evolved from an operational role to a strategic one, focusing not just on transactions but also on total costs, risk management, and creating value for customers.
• 💼 The education and development of purchasing professionals have become more important, with an increase in educated individuals in the field over the past decades.
• 🏢 There's a significant need for further education in purchasing, especially in smaller companies, to enhance competitiveness and professional development.
• 🌐 Sanna emphasizes the importance of internal collaboration, suggesting that understanding purchasing can benefit various departments, not just the purchasing team.
• 💡 Purchasing can bring value to a company by looking beyond immediate costs and considering the total cost of ownership, which includes all expenses related to the acquisition and use of a product.
• 🔍 The total cost of ownership is crucial for making informed decisions that affect the entire business, not just the purchasing department.
• 🛍️ Purchasing is not just about finding the best price; it's about understanding the full financial impact of business decisions, including make or buy decisions.
• 🌐 Sanna encourages cross-departmental communication and understanding, such as involving sales managers in purchasing discussions to align business strategies.

Q & A

What is the background of Sana, the guest speaker in the discussion?

Sana is a teacher at Young and has been working there for 20 years. Prior to that, she worked at Walmart in various purchasing positions for 10 years.

How does Sana stay inspired and motivated in the field of purchasing?

Sana finds inspiration in meeting new companies and purchasing teams, as she sees the potential for development in purchasing management and business development through purchasing.

What has changed in the field of purchasing over the years according to Sana?

Purchasing has evolved from being an operational part of businesses to a more organized, managed, and strategic aspect. It now involves considering total costs, risk management, and creating value for customers.

Why is purchasing education still necessary despite the advancements in the field?

Purchasing education remains necessary because there are still many professionals in the field without proper education, and companies, especially smaller ones, are increasingly hiring educated individuals to develop their purchasing capabilities.

How does Sana convince smaller companies of the value that purchasing can bring to their business?

Sana educates and works with smaller companies to help them see the whole business as their playing ground, encouraging internal collaboration and a broader understanding of how purchasing can contribute to overall business success.

What is the significance of 'total cost of ownership' in purchasing?

Total cost of ownership is significant because it shifts the focus from just the purchasing price to the entire cost structure, including costs associated with ownership, which helps in making more informed and strategic decisions.

How does understanding total cost of ownership impact business decisions?

Understanding total cost of ownership helps in making strategic decisions such as the make or buy decision, which can set the stage for the purchasing department's success and the overall business's financial health.

What is the role of purchasing in creating value for customers?

Purchasing plays a role in creating value for customers by collaborating with other departments like sales and R&D to understand market needs and offer products or services that meet those needs more effectively.

Why is it important for professionals in other departments to understand the value of purchasing?

Understanding the value of purchasing is important for professionals in other departments because it fosters internal collaboration and allows them to work together more effectively to improve business processes and outcomes.

What advice does Sana give to those interested in pursuing a career in purchasing?

Sana advises those interested in purchasing to pursue education in the field and to stay open to learning and development, as there is still a significant need for professionals with purchasing expertise.