In the last decade most companies in the electronics industry have invested significant efforts in streamlining their design, testing, and manufacturing processes. Time-to-market pressures are intensifying; engineers and technical support staff often work overtime to meet product deadlines. But there’s one task that is still typically slower than molasses in winter—and that’s procurement.
Ask nearly anyone who works for a medium- to large-sized tech company about their procurement process and you’ll see their eyeballs roll up in their heads. Procurement often requires a long and painful visit with in-house lawyers, or collecting a million signatures to get permission to buy a $100 part. Engineering managers have been known to pay for parts using their own credit cards rather than deal with the rules of procurement. I’ve seen a company refuse to spend an extra thirty bucks for overnight shipping on a part that was holding up its own multi-million dollar product. It’s crazy.
Don’t get me wrong: I have no doubt that competent lawyers and purchasing experts can add value for their companies, helping to make sure the company gets good prices and terms from its suppliers. But I think part of the problem is that the people who often slow down the procurement process don’t see the contradiction between their relaxed pace and their company’s need to get new product shipped before the next ice age. It’s the engineers who are on the hook for getting that product out on time, but they are mired in rules and limitations imposed by people who don’t feel the crippling effects. I have yet to see a product development schedule that allocates time for procurement, or an attempt to hold someone accountable if the procurement process delays the release of a new product.
Companies with efficient procurement procedures have a big competitive advantage. Plus, their engineers are much more likely to maintain their sanity.
Do you have a special procurement story to share? Send it to pain@bdti.com. I’ll post the best stories in our newsletter (with all names/companies left anonymous– hey, we don’t like to deal with lawyers, either.)
Jeff Bier is the president of Berkeley Design Technology, Inc. (www.BDTI.com), a benchmarking and consulting firm focusing on embedded processing technology. Jennifer Eyre White of BDTI contributed to this column.
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