The rise of Chief Procurement Officer Many business corporations have resorted to centralizing their procurement operates for the past few years where there has been switch from the traditional local and regional procurement to the centrally structured supply chain headed by the Chief Procurement Officer (CPO) (Lumsden & MacEachem, 2010). The changes in the procurement practices have come about due to globalization where manufacturing companies, insurance, banks, healthcare providers, service industry as well as the hospitality firms aiming and centralizing their supply chain management practices. The implication is that businesses are reassessing the efficiency of their operations as well as the effectiveness of the supply chains matches the trends in the global supply chains (Johnson, Leenders & Flynn, 2011).
1. Business Line, Mission and Goals of Starbucks Starbucks Coffee markets, roasts and retails unique blend of coffee across 65 countries on a global scale (Starbucks Corporation, 2012). The unique blends of coffee are sold alongside other beverages such as tea, food cuisines and handcrafted coffee. Besides, the company sells some culinary equipment such as coffee brewers and beverage preparation accessories.
One of the objectives of the company is to provide the right product mix to the customers and also becoming the most respected as well as the most recognized coffee brand globally. It also aims at expanding its retail operations, growing the mail orders and introducing new products into the market. The mission of the organization is to inspire as well as inspire human spirit where the focus is on one person, one cup, and one neighborhood. The goal is to expand by opening around 1,000 stores in the USA within the next five years (Dow Jones & Company Inc.
2015). Also, part of the goal is to expand and establish new stores, around 1,500 locations in the Asian market, China in this case, and also dominate the East Asian market. Another goal is to maintain good leadership and management that will enable the company to be innovative and introduce new coffee products into the market. 2. The Chief Purchasing/Procurement Officer of Starbucks: Lauren Richardson Richardson is currently the Chief Purchasing Officer of Starbucks Company whose role has been to make sure that the procurement or purchasing practices are streamlined along the objectives, goals and mission of the company (Dow Jones & Company Inc.
2015). The job functions The responsibilities or Lauren Richardson are typical of a Chief Purchasing Officer who works on the behalf of the organization to negotiate the cost of goods as well as services from the various vendors (Dow Jones & Company Inc. , 2015). In this case, Richardson has the responsibility to negotiate the cost of good, coffee brewing materials and other food stuff, with various suppliers from around the world.
It is also important to note that the responsibilities of CFO depend on the size of the organization and scope of operation. For small companies, the CFOs manage the inventory while, for the multinational corporation like Starbucks, the functions involve managing and supervising other employees and procurement practices in foreign countries. Therefore, Richardson coordinates the procurement practices from various Starbucks’s stores at a global scale. Nonetheless, the CFO has the responsibility of working closely with the company’s accounting department to verify that the vendors are paid immediately after they deliver the services (Lumsden & MacEachem, 2010).
Besides, the chief procurement officer is tasked with handling service contracts and also authorizing new vendors. The job responsibilities are fulfilled upon the issuance of purchase orders where they also refer to other documentation to track the purchasing activities. Nonetheless, the purchasing officer utilizes the companys auditing software when managing assets of the corporation. Besides, the CFO supervises related departments. Educational requirements of CFO The Chief Procurement Officers fall under the upper management team, and many organizations recommend that they should be holders of masters degree in business administration or the related field (Lumsden & MacEachem, 2010).
Also an important part of educational requirements is good academic background in finance, accounting, and economics. A Chief Procurement Officer must also have good knowledge about supply chain management, markets, pricing and also a good or clear understanding of the commodities related to the company. Mr. Richardson is currently the CFO of Starbucks and is part of the companys board of directors. He has had a good employment background, working with the Juniper Networks, and Microsoft Corp.
his outstanding managerial skills comes from the good background in business administration and management from the New Mexico State University (Starbucks Corporation, 2012). The previous employment positions have enabled him to master successfully some of the skills needed for effective supply chain management. Though it has become quite a challenge adapting to the new job role since 2014, the challenges are akin to the supply chain management including having to respond orders from the global suppliers as well as ensuring that the strategic objectives of the procurement are integrated in the entire procurement practices (Dow Jones & Company Inc.
2015). However, being a high profile person as he is, personal challenges have been confined to managerial duties where the CFO has to respond to negotiations in cross-cultural contexts. In fact, as the company continues to increase its influence globally, the CFO will have to deal with business negotiations that require a mastery of cross-boundary business negotiations. On the contrary, significant accomplishments in the companys supply chain management and procurement have been made by the previous CFOs since Mr.
Richardson has only served around seven months since being appointed to the position. Nonetheless, CFOs job achievements and fulfillment stems from his capabilities with, for instance, strategic skills. In this regard, the Chief Purchasing Officer is been able to view the business in a global perspective and developed procurement visions as well as strategy that aligns with those of the business (Dow Jones & Company Inc. 2015). Besides, as the head of the purchasing department, outstanding leadership is also posed to help him achieve tremendous success and also the ability to influence business negotiations.
Nonetheless, the CFO is result oriented since the position requires individuals who do not take no for an answer. In this case, his skills have been crucial in ensuring continuity of the business operations, building healthy relationships and saving costs. Overall, the CFO has the necessary educational background as well as good supply management skills to steer Starbucks into success and fulfill the mission of offering customers with unique tastes and experience from the coffee blends. 3. The operational and strategic objectives of the supply and purchasing department The supply chain department of Starbucks is built on the companys focus building good relationships with customers, vendors, and the public in general (Starbucks Corporation, 2012).
Part of the strategic objectives is to ensure that the department contributes a great to the social responsibility initiatives. In this case, the department cross-checks with the supply chains to determine the extent to which the they are committed to embracing issues like Corporate Social Responsibility as a strategy that the organization believes is necessary for attaining competitive advantage (Dow Jones & Company Inc.
2015). On the other hand, the Department is fully committed to ensuring that the company fulfills its strategic objective of expanding and increasing its influence in other international markets. Therefore, part of the plans by the Department is to ensure that the projected 1, 500 locations to be opened in China becomes a success (Dow Jones & Company Inc. 2015). Nonetheless, Starbuck’s operational objective is cost saving where the focus is to ensure that minimum resources are used so that the company is able to charge prices that the customers can sustain.
In this case, the procurement department has been in the forefront in negotiating the best prices from vendors where the focus is to save costs. 4 How the above supply objectives align with the organizational mission and goals The company’s supply chain management has set some strategic objectives that will be crucial in meeting the goal of expanding both domestically and internationally (Starbucks Corporation, 2012). Already, the department has incentives for building good relationships with the local vendors so that the goal of opening 1,000 new stores in the USA market becomes a success (Dow Jones & Company Inc.
2015). Besides, proper negotiation is the core strategic objective of the department, and this will help in expanding into global markets as one of the goals of the corporation. In effect, the CFO ensures that prices are negotiated while keeping the business’s aim of saving costs to reduce prices to the customers in mind. References Dow Jones & Company Inc. 215. Starbucks Corp. Retrieved from http: //quotes. wsj. com/SBUX/company-people/executive-profile/27399 Lumsden, S & MacEachem, D 2010. The Rise of Chef Procurement Officer http: //www. supplychainquarterly. com/columns/scq201001careerladder/ Starbucks Corporation. (2012).
Retrieved from http: //www. starbucks. com/ Johnson, P. F., Leenders, M. R., & Flynn, A. E. (2011). Purchasing and supply management. McGraw-Hill/Irwin.