Organizational design in public procurement: A stakeholder approach

Organizing the purchasing function for public bodies and other non-profit and/or non-market bodies starts with the selection of an appropriate organizational strategy. In order to be able to select between generic strategies like low cost and differentiator or strategies described as operational excellence, customer intimacy and product leadership, a stakeholder based model was used. The selected strategy forms the basis to design the nature of three organizational elements: policies (P), organization (O) and processes (P). The aspect system of the purchasing function and the sub-system of the purchasing department reflect the nature of these three POP elements. It helps to translate the selected organizational strategy into a appropriate supplier strategy and clarifies the idealized mix of suppliers in terms of portfolio archetypes. Ten policy aspects of purchasing and four organizational aspects are described to redesign purchasing.