The role of indirect procurement in capital equipment sourcing
Hivessy, Rita Klara (2025)
2025
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2025052917961
https://urn.fi/URN:NBN:fi:amk-2025052917961
Tiivistelmä
This thesis examines the role of indirect procurement in capital equipment sourcing, with focus on developing a proposal to create sourcing strategies for this purchasing category segment at global manufacturing companies.
While capital equipment purchasing is normally based on technical specifications and engineering requirements hence the procurement process is often led by engineering and manufacturing departments, this study emphasizes the strategic contribution of indirect procurement as part of the cross-functional collaboration that is needed for successful decision-making during the process.
A central theme of the case study is the organizational contradiction between the strategic importance of capital equipment investments and the rather neglected, underdeveloped state of the indirect procurement function that should be responsible for managing them. Indirect procurement could have similar potential as direct procurement in improving cost-efficiency, compliance, and supplier performance and therefore increasing value added however it needs to be developed from a support function into a mature, strategically guided function in order to achieve similar results as its direct counterpart.
As outcome of the thesis, recommendations are proposed for creating sourcing strategies for capital equipment, including the collection and analysis of various data about the existing machine pool of the company, to support efficient and successful decision-making during the procurement process of new equipment.
While capital equipment purchasing is normally based on technical specifications and engineering requirements hence the procurement process is often led by engineering and manufacturing departments, this study emphasizes the strategic contribution of indirect procurement as part of the cross-functional collaboration that is needed for successful decision-making during the process.
A central theme of the case study is the organizational contradiction between the strategic importance of capital equipment investments and the rather neglected, underdeveloped state of the indirect procurement function that should be responsible for managing them. Indirect procurement could have similar potential as direct procurement in improving cost-efficiency, compliance, and supplier performance and therefore increasing value added however it needs to be developed from a support function into a mature, strategically guided function in order to achieve similar results as its direct counterpart.
As outcome of the thesis, recommendations are proposed for creating sourcing strategies for capital equipment, including the collection and analysis of various data about the existing machine pool of the company, to support efficient and successful decision-making during the procurement process of new equipment.