Dunhill Company Procurement Process Re-engineering Study

Concerning the control of cost, purchasing is by far the most important area in the firm. 40%-60% of the cost of good sold are purchased item. Firm can become competitive through reengineering their purchasing process.The concept of reengineering has been around for nearly two decades and has been implemented in a piecemeal fashion in organizations. Production organizations have been in vanguard without knowing it. They have undertaken reengineering by implementing just-in-time, lean production, total quality management. These represent fundamental rethinking of the manufacturing process. Manufacturers generally made significant improvements in their internal operations during the 1980s.Business process reengineering is defined as "the fundamental rethinking and radical redesign of business process to achieve dramatic improvements in critical, contemporary measure of performance. Reengineering is base on long strategy, and redesign value-adding work. Non value-adding work is to be eliminated. The focus is shifting away from functional silo toward a holistic view of organization. Such change is being made through process and organizational innovation as well as through creative application of information technology.