Importance of Procurement Management In Public Sector
Procurement is applied so as to increase the profitability of a given organisation. Profit in this context is not necessarily defined in monetary terms. Procurement in the public sector entails streamlining processes, reducing the prices and costs of raw material and finding better supply sources. This function of reducing the bottom line is placed in the docket of high executives in the public sector. The executive board is responsible with handling procurement functions in the public sector.
Perhaps the fact that the procurement function at an organisation is in the job description of a selected few is why it is one department that is mostly marred by corruption. Especially in the public sector, it is common to find that money exchanges hands in order for the procurement process to go in the favour of particular people. This is normally a source of a lot of conflict in most organisations. However, when handled in the proper way, procurement management normally works to the advantage of the organisation and its clients.
Since there are no stakeholders passé when we are looking at procurement management in the public sector, it is necessary to focus on the gross output. In this case the public sector can come up with strategies to maximise this output. For example they can focus on training their staff in order to make them more efficient and in the long run make their services better and hence improve their output.
The stakeholders at the public sector level are the taxpayers. The finds that the public sector carries out its functions with is basically gotten from the taxpayers. The taxpayers therefore expect that the public sector will carry out all its functions accordingly and be accountable. Procurement management procedures are done according to the law of the land and high levels of transparency and accountability are applied. For example, issuing of government tenders normally follows an elaborate procedure. The companies awarded such tenders have to meet certain criteria that are already described by law. This structured procurement management wards off a lot of disputes and even court charges on the claim that the taxpayers’ funds are being misused or unfairly distributed.
The law of the law also greatly affects how all other functions of procurement management are undertaken. For example, these functions lie in the docket of procurement officers in a given sector. Government officials are not supposed to influence these processes in any way. Using their political influence control the procurement functions is illegal. Therefore, proper procurement management ensures fairness, openness and accountability in the public sector. When a truly deserving company is issued a tender then the public sector flourishes because they will not be paying high prices for substandard services or goods.
In a sense, procurement management in the public sector is important because it ensures that the sector is getting value for money.
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