Who does what? A Look at Procurement's Role in the Supply Chain
Recently an issue was brought to my attention on a shipment received in our warehouse. There was a quantity issue and a cost issue, but no one seemed to know whose responsibility it was.
The issue came up again, during a discussion at our local ISM meeting the other night, we realized there seems to be no really set rules. When is it a procurement problem? When does it become an AP issue? And when is it a receiving department issue?
It seems that if you receive the wrong quantity, the receiving department should handle it by shipping it back. If you receive the wrong item, the buyer should handle it directly with the supplier. If the cost is wrong, the AP department or in some companies the costing department should handle the issue. But what about freight issues? Is this a logistics issue?
At our meeting, we could not come up with what you would call a standard operating procedure. All companies do not work the same. Size and departments of a company makes a difference.
I would be interested to know if any companies have specific guidelines on who does what. As a buyer, you can’t very well say, “That is not my job.” The problem has to be handled but the question is by whom? What really determines which department is responsible, procurement, accounts payable or your receiving area?
Share your thoughts by posting a comment on this page.
DUBESS commented:
Can someeone explain what purchasing people do what? In my
organization, we have supply chain manager, commodity manager I and
sr commodity manager(though no commodity has been specified - they
just calls on suppliers w/out notifying the buyer), a planner,
expediter, materials mgr, purchasing manager, stragetic sourcing
managers and mteals buyer. As a senior buyer - what are my duties?
I have requested a copy of my job description and it states the
obvious things a buyer should do, but if someone else is checking
on my PO's, someone else is handling all the planning, min order
buys, safety stock levels, if someone else is negotiating lead
times and pricing - what exactly am I left doing? Almost nothing. I
have worked as a sr buyer for over 7 yrs. I am confused. There are
too many people doing the same job - all with different titles. As
anyone else experienced this? Any suggestions?
byrsue commented:
In my company the responsibility for incorrect shipments, pricing,
invoice discrepancies and RTV's are handled by the procurement
group.
Mary Walker commented:
Some people contend that if purchasing did not have problems with
the suppliers, buyers would be out of a job. I know I spend a great
deal of time on non conformances. It would be great to only have to
buy product. Mary
Scott commented:
Purchasing should be the first line of defense for these issues -
Purchasing needs to slap the vendor around so that they ship the
correct product at the correct price. Quality issues need to be
addressed also with QC
skk commented:
Most everything falls into the hands of Purchasing, although we
believe some of this should be handled by Accounting. If Receiving
is wrong, Purchasing must contact supplier. If supplier terms
change, Purchasing must update system. Purchasing obtains terms,
forwards credit info, sets up new suppliers, maintains supplier
data base, requests invoices, and contact supplier regarding any
Receiving issues.
DMJ commented:
In our organization - most falls to the purchasing group. We run
SAP and the workflow system parks the invoice until resolved. It is
purchasing's responsibility to seek the resource needed to resolve
the issue. You are correct - it will change from company to company
dependent on the system they run and the resources available.
Mary Walker commented:
What about the company that has a costing department that is
responsible for the costing in your computer system. Also the
company that has people in the warehouses that handle non
conformance issues, the warehouse has the packing list and also the
product. Sure we work with the supplier, however most issues relate
to pricing not being updated or items received in wrong. In a
dispute issue, sure the buyer should handle the situation, however
just a price issue or a quantity issue, should the buyer spend
their time on these type of issues? Just wondering?
Tim commented:
if for quality issue,IQC always feedbacks to SQE and SQE will
handle the issue; if for other issues, receving department always
feedbacks to buyer, buyer will be the leader(maybe refer to some
different departments such as logistic, purchasing and finane, etc)
to resolve the issue with suppliers;
beginner commented:
That is why in this world there was a subject call supplier
relationship management. Should be the responsibility of the most
forefront personel dealing with supplier.
DaileySK commented:
Sounds familiar, my experience has taught me that most accounting
departments are unwilling and/or incapable of managing receipt
discrepancies, e.g. quantity or prices. As such, the task of
rectifying such mistakes fall upon procurement, as the buyers
typically know the suppliers well enough to resolve the issues,
albeit with a lot of effort. SD
