Stewardship
The term ‘stewardship’ is used in a number of different ways, but at its core, stewardship is the responsible management of resources. In the context of procurement, stewardship refers to the responsibility that procuring organizations have to ensure that the goods and services they purchase are used in a way that maximizes value for money. This means taking into account not only the initial purchase price, but also the long-term costs of ownership and operation. It also means ensuring that the goods and services purchased meet the needs of the organization and its stakeholders.
When making procurement decisions, organizations need to strike a balance between cost, quality, and risk. The goal is to find the optimum mix of these factors that will generate the greatest overall value for the organization. This can be a challenge, particularly when there are limited resources available. However, with careful planning and execution, it is possible to achieve favorable results.
There are four key elements of effective procurement stewardship:
1. Strategic sourcing: This involves creating a long-term plan for procuring goods and services that takes into account all relevant factors, including cost, quality, lead time, risks, and sustainability.
2. Contract management: This involves developing contracts that clearly define expectations and setting up procedures for monitoring performance and ensuring compliance.
3. Supplier relationship management: This involves establishing and maintaining good working relationships with suppliers in order to get the best possible value from them.