The purchasing department owes part of its added value to monitoring and surveillance actions of markets, products, suppliers, and technologies… Global actions that cannot be carried out by internal clients, who will favour operational, fast, known solutions, and do not always have the time to monitor the innovations of their suppliers.
Market, technologies, innovations: following the trends
Among the 5 key skills of buyers, market expertise is essential.
| Key Skills | Description |
| 1. Leadership & Management | Listening, Influence, Conflict Management, Delegation, Motivation, Organization |
| 2. Process & Project | Persuasion, languages, creativity, project management, risk management, regulatory compliance, cultural adaptability |
| 3. Client Expertise | Understanding of objectives, processes, and constraints; ability to develop specifications |
| 4. Market Expertise | Rapid acquisition of new technologies or standards, benchmarking, networking, knowledge of key players including their strengths and weaknesses |
| 5. Technical Purchasing Expertise | Analysis |
In practical terms, it is important for a buyer to keep abreast of technological developments that could impact purchasing. Thinking in terms of “overall added value,” new technologies such as the Internet of Things, geolocation and hyperlocation, big data, and the usage economy are areas for improving profitability that should not be underestimated. While the purchasing function can certainly generate value gains by having a basic understanding of the “standard” technologies, products, and services in the purchasing domain, and through supplier benchmarking, much broader gains can be achieved by exploring new technologies or services and considering how they could be integrated into internal product design processes or internal services.
Developing a professional network
The internet is certainly a valuable source of information that allows you to monitor your markets, suppliers, and technologies. However, the personal contacts you cultivate with various individuals at trade shows, networking events, or business lunches are also sources of information that should be regularly activated. Too often, when we talk about networking, we think of general social networks. You can also develop your own network, for example, by establishing a network of partners to address a logistics or supply crisis. Don’t forget dedicated networks, such as those for public procurement officers or for accessing companies in the supported employment sector (ESAT-CAT, etc.). Finally, your company’s internal network is a rich source of information because almost everyone is in contact with suppliers and their own network.
Analyze and synthesize information, create competition between your suppliers
Once all the sources and information have been identified, you will then need to analyze and synthesize them. For example, you can conduct a prospective study to determine future trends in your markets (or use existing studies if available), drawing on your industry knowledge and/or an analysis of your latest spending figures. You can also study the market constraints of your suppliers to anticipate the potential future impact of these trends on your own purchases (for example, fluctuations in raw material prices).
Finally, various models exist for synthesizing and using the information you have gathered. Porter’s Five Forces diagram is a good tool for analyzing and understanding a market. It involves evaluating:
• The threats from new entrants
• The competitive rivalry of current market players
• The threat of substitute products (including innovations)
• The bargaining power of upstream market players (suppliers)
• The bargaining power of downstream market players (customers)
