Lean Procurement

Procurement’s core responsibilities have expanded to play a critical part in improving the flow of information and materials throughout the entire supply chain. Best practice procurement management functions move far beyond the classical contract negotiation by establishing fundamental operational requirements, engaging in strategic sourcing activities such as market research, vendor evaluation and integration.

The challenges in procurement

Procurement organizations face a significant amount of challenges, both internally and externally, which leads to an inability to manage the total spend of the company and to a high focus on the direct cost / price

  • Internal challenges
    • High cost pressure
    • Inefficient procurement processes and low skilled procurement teams
    • Decreasing leas times and increasing quality standards
  • External challenges
    • Volatile markets and therefore a decreasing forecast accuracy
    • High variability of quality and lead time
    • High competitiveness and battle to maintain margins

These challenges are forcing the procurement teams to work in a reactive mode and forces them to strive for unrealistic expectations, rather than focusing on the total cost of ownership.

How Lean management positively impacts procurement

The Lean approach aims to address holistically the challenges facing procurement organizations and to reduce overall buying cost and decrease working capital.

  • TRANSACTIONAL IMPROVEMENTS – Ensure a smooth “purchase-to-pay” process through standardizing the product specifications and streamlining the transactional processes
  • STRUCTURAL IMPROVEMENTS – Implement the correct procurement monitoring methodologies and KPIs to enhance internal compliance with contracts and procurement policies
  • SUPPLIER MANAGEMENT – Integrate suppliers and create a transparent and performance-based relationship
  • STRATEGIC SOURCING – Implement an efficient strategic sourcing process in order to improve purchasing power and achieving long-term benefits
  • PROCUREMENT STRATEGY – Define a procurement strategy and a delivery model in order to build a performing procurement function that contributes to creating value for the company
  • DIGITIZATION: Leverage the use of technologies to ensure information flow along the supply chain, reduce reaction times for procurement and purchasing and continuously improve processes through focused data analysis

What will this course achieve?

In our Lean Procurement course, you will run an interactive simulation that will illustrate how Lean management principles can improve the efficiency of processes and reduce volatility and lead times in your supply chain. You will get to know the fields of action and the respective tools, like:

  • Fundamentals of Lean Management in the context of procurement
  • Design ideal purchasing processes based on Value Stream Design
  • Supplier evaluation and development
  • Elements of strategic sourcing
  • Supplier management systems
  • Change Management and Continuous Improvement
  • Digitization in procurement

Who should attend?

Executives and administration managers responsible for the supply chain, procurement or purchasing; lead-buyer and commodity managers who want to gain an overview of Lean concepts in procurement.

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2 days
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After graduating, Fabio first applied his Lean expertise at Carel Industries in Padova, Italy. A global HVAC/R business, his work for Carel enabled him to apply a complete Lean transformation as part of the company’s internal support team, a project which involved dealing with both direct and indirect processes.

Having completed his work at Padova, Fabio was tasked with similar Lean transformations at Carel’s plants in Suzhou, China and Lancaster, in Philadelphia, USA – two contrasting cultures which gave him an invaluable insight into how Lean is applied and adopted in very different geographies within a single global enterprise.

After seven years with Carel, Fabio then joined global home appliances manufacturer Whirlpool Corporation. Here, he applied Lean in improving strategic supplier integration and performance, managing the company’s EMEA Supplier Integration Programme for two years before leaving to join Four Principles.

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