To Whom Should Purchasing Report?

Like the question that led up to the article "What Is Supply Chain Management, Anyway?", I have commonly gotten questions like "To whom should Purchasing report?"

My answer: it depends.

To whom the purchasing function reports to can be different from company to company, and that's OK.

To simplify it, if the company sees Purchasing's primary role as delivering cost savings, the company generally positions Purchasing under Finance, reporting up to the Chief Financial Officer. If the company sees Purchasing's primary role as supporting operations (through assuring continuity of supply, reducing risk, etc.), then the company generally positions Purchasing under Operations/Supply Chain Management, reporting up to the Chief Operations Officer or VP of Supply Chain.

As another generalization, in manufacturing I see Purchasing more commonly reporting to Operations/Supply Chain Management and in service industries Purchasing more commonly reporting to Finance.

To Your Career,
Charles Dominick, SPSM
President
Next Level Purchasing, Inc.
Struggling To Have A Rewarding Purchasing Career?
Earn Your SPSM Certification Online At
http://www.NextLevelPurchasing.com