For organizations to be successful commercializing new products and technologies in today’s dynamic business environment, they need to involve procurement professionals throughout the product design process of a product’s life cycle, starting at the beginning. Procurement teams identify and create strategies for reducing costs and develop and manage supply partners, creating a competitive advantage and contributing to their organizations’ bottom lines. This level of input doesn’t need to be delayed until after the design process though. In fact, it shouldn’t be.
Because of their comprehensive knowledge of capabilities, cost controls, and manufacturing processes, procurement professionals can add considerable value to a given program, even early on. By working with designers and engineers during the design phase, instead of working after them, procurement teams help answer design and materials questions that commonly solve problems long before they happen, ultimately improving timeline efficiency, which subsequently reduces costs. Procurement should do whatever it takes to be included during the early stages of a product’s design.
Including the procurement team in the product design process isn’t everyone’s favorite thing to do. In fact, many organizations don’t even think to add procurement until they’re ready to purchase something. However, the procurement team’s perspective and involvement at an early stage in a product’s life cycle, is necessary for the success of most organizations.
As a procurement professional, a program’s success is part of the occupation, and sometimes this can put them in quite an awkward position, especially when responsible for ensuring timelines are met and costs are contained. Procurement, in any organization, should be involved in the design for manufacture process, lead timelines, and cost management. And similar to anyone trying to drive strategic initiatives, procurement professionals will face resistance. This is why it’s a procurement professional’s responsibility to not only involve themselves from the beginning, but also to make a case to ensure they’re involved.
3 Reasons to Involve Procurement in Product Design
1. Design for Manufacturing
It’s imperative that engineers design a product with the best available information, as well as for ease in the manufacturing process. Most often this isn’t the case, due to the lack of information engineers have at the onset of designing a part. Therefore, involving procurement in the design phase is critical.
The procurement team typically has a better understanding of the process, material, and availability required to manufacture a product efficiently and effectively; whereas designers and engineers can design great products, but not necessarily with the ideal materials or processes in mind, which could lead to price increases and lengthy timelines. Procurement professionals can offer a wealth of valuable insight in these early stages, so small setbacks won’t become large ones and so that the likelihood of a redesign is greatly reduced in the long run.
Another area where procurement can provide meaningful guidance is the availability of Commercial Off the Shelf (COTS) parts. Many times, COTS parts are designed into an assembly because they’re the best available items to the engineers’ knowledge. This may be the case for a procurement team as well, however they can take it one step further and ensure that these parts will be available for the life of the program and create a strategy based around this. Too often, there are design changes or there’s obsolescence of COTS parts where engineers must create redesigns prior to or after a product launch due to said parts no longer being available. This is why engineers should heavily consider designing products for manufacturing with the support of the procurement team.
2. Drive Timelines
It’s critical for the procurement team to lead and drive program timelines or they’re at risk of being hindered by other departments. Designers and engineers are perfectionists by trade, and aren’t happy until their work is flawless. Unfortunately, there’s never enough time for everything to be perfect, and deadlines must be kept. The procurement team doesn’t usually create a program timeline itself, but it’s their obligation to the customer and their internal organization to draw these lines in the sand. As long as communication is transparent between design and engineering and procurement, the organization should be able to produce the best product possible in the time that they have to work with.
3. Manage Costs
In tandem with managing a program’s timeline, procurement professionals should drive costs too. Since the procurement team is involved in the creating of budgets, they should also be involved in anything that affects them. These costs must be managed at the beginning of the program, as opposed to post design. Procurement professionals have extensive awareness and knowledge of budgets and cost strategies, which makes involving them in the design a win-win situation. Involvement in the early stages of design will lead to a more cost-effective product, helping to prevent a time-consuming, cost-hungry re-design in the future.
To give their products the most potential for success, organizations need to include procurement teams as early as possible in the product’s life cycle. Keeping those three reasons in mind will put a company in the best position to design, develop, and launch the best version of a product in the most timely and cost-effective way.