Best purchasing systems address global issues

The creation of Rio Tinto Group into one of the world's largest multinational mining companies, and its takeover of major aluminum producer Alcan in Canada, has taught procurement management that "an adaptive and adaptable buying organization" is essential. "You can't have a one size fit" sourcing organization, Scott Singer, global head of procurement for Rio Tinto, tells Purchasing's Smart Sourcing Summit in Chicago.

Sheer size is an issue since the company has a $12 billion annual spend with more than 50,000 suppliers servicing 54 spend categories. The company generates 2.5 million purchase orders annually from eight business hubs-Brisbane and Perth, Australia; Shanghai, China; Singapore;  Johannesburg, South Africa, Voreppe, France; Montreal, Canada; Salt Lake City, Utah-and business process outsourcing operations in Monterrey, Mexico, and Pune, India.

"The journey has been a wild ride and we have no idea what's really ahead of us" as the world exits the recession, Singer says. That's why he is stressing to procurement groups worldwide that "there's lots more to do on such issues as spend analytics, inbound logistics, intellectual capital and what he terms a ‘purchase to pay' mindset.

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