The ULTIMATE Procurement Policy Authoring Guide

There are many schools of thought on how to write a great Procurement policy. This is mine. In the following 13-min article, I outline how to get from a blank page to a completed, best-in-class Procurement policy.

Whether you’ve been wrestling with the limitations of an outdated Procurement policy or your organization is due to create one for the first time, this article is for you.

Note: The below recommendations apply to large multi-national companies. If you are working in a smaller company, the approach will still be applicable but will need to be right-sized to your reality and needs.

Introduction

I’ve read A LOT of Procurement policies over the years… The majority of them were painful to read... They were unclear, imprecise, confusing or too high-level and typically generated more questions than they answered. They did not achieve the two main objectives of a Policy:

• Setting clear expectations of behavior when engaging in a specific set of activities (e.g. Procurement)

• Tying these behaviors back to company values, mission and vision (culture!)

A policy is all about setting standards for your company. It’s therefore impossible to write a good Procurement policy without defining the following:

• Your terms (definitions)

• Your policy’s scope (process: what’s in, what’s out)

  • This includes defining your Procurement policy’s relationship to other company policies

• The roles and responsibilities of the people executing the processes in scope

• The guiding principles and/or non-negotiable business rules for the processes in scope

  • This may include references to technology but isn’t essential as systems change over time.

If you’re Procurement policy does this, congratulations, you’re WAY above the fold. If not, here’s the playbook.

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