Optimizing purchasing management of non-product-related goods and services

Until recently, purchasing was very manufacturing oriented with an emphasis on production buying. The purchasing of non-production goods and services has only gained limited attention from management and researchers. Because of this undervaluation there is often no clear and direct insight in the size and content of the purchasing volume of non-production items and services. It is often difficult for most managers to identify the answers to basic questions like: how much is spent?; on what?; by whom?; with what frequency?. In many companies non-production goods and services are purchased without the involvement of the purchasing department. This is not necessarily bad, but it requires management to control these purchases in a different way. For this reason we analyse the current methods that are used for controlling the purchasing of NPR goods and services. The paper starts with a description of the importance of effective purchasing and the current developments and changes that affect purchasing organization and control. Then we focus on NPR purchases, a likely candidate for being done outside of the Purchasing Department. Then we describe the current methods used for managing purchasing outside of the Purchasing Department and their shortcomings. We conclude that it is an imperative demand for new methods in controlling purchasing of non-product-related goods and services.