Eskom Procurement Book 2015

THE PLANNING, ORGANISING, LEADING AND CONTROL OF PROCUREMENT

achieve the company goals. The identified procurement activities ought to be further broken down into specific tasks to be accomplished by specific staff members in the department. • Classifying activities – It is important that a duplication of activities by different departments in the same organisation be avoided. Duplication of activities can be costly and is a recipe for inter-departmental conflict. It is therefore necessary for the procurement department to identify related procurement activities and to prevent such duplication. • Allocating staff – Once divisions or sections have been established in a procurement department, the next step is to identify the number of staff members required, together with the skills they need to possess. • Assigning authority and responsibility – After allocating staff members to their respective divisions, the procurement managers ought to assign authority and responsibilities to each divisional office. At this stage, the duties of each staff member should be clearly spelt out in order to foster co-operation among staff members. Conflicts that might tear apart the department may arise if the assigned authority and responsibilities are not clearly set out. • Facilitating work – When all the structures of the procurement department have been established, the management of the department should facilitate work by ensuring that the staff members are informed of work methods, so that the procurement plans are carried out properly and timeously.

3.3.2 BASIC PRINCIPLES OF ORGANISING FOR PROCUREMENT

Certain principles affect or may come into play when organising procurement.

3.3.2.1 The Co-ordination Principle

Co-ordination refers to the synchronisation and integration of procurement activities, responsibilities, and command and control structures to ensure that the resources of a company are used most efficiently in the pursuit of procurement objectives. The co-ordination principle requires procurement managers to define the chain of command, unity of command and extent of control. The chain of command refers to the line of authority that stretches from the top leadership to the lower ranks of the organisation. The unity of command refers to the notion that each employee should answer to only one immediate superior, while extent of control refers to the number of employees directly reporting to a procurement manager.

3.3.2.2 The Authority Principle

Authority is the power or right to give orders, make decisions, enforce obedience and use resources. However, the power wielded also depends on how the procurement department is structured. In other words, it determines

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