THE Nigeria Liquefied Natural Gas, NLNG, has charged procurement managers to ensure transparency and efficiency in contract and procurement processes. Babs Omotowa, chief executive officer and managing director, Nigeria LNG Limited, said due processes, transparency, benchmarking database, and e-procurement, are indeed the right direction for the Nigeria LNG.
He noted that in many countries and companies, the expenditure on goods and services accounts for 60 or 70 per cent of their total expenditure. This, Omotowa said clearly has significant impact on the bottom line, either in terms of profitability or the delivery of socio-economic impact. He said many oil and gas producing nations were taking various steps to respond to the challenge of low oil price by cutting costs.
According to Omotowa, many companies are also swiftly reacting by cutting capital expenditure, postponing projects and reducing overhead. “In the past few months I have visited many countries in the course of my Global Presidency of the CIPS (Chartered Institute of Procurement and Supply), the world’s largest professional body for the Procurement and Supply profession with over 114,000 members globally and headquarters in the United Kingdom. From those visits, I have been struck by how hungry the world is for a different kind of contract and procurement model and much more creative ideals,” he said.
Omotowa said the role of procurement had changed remarkably over the years from that of an administrative back office to overseeing an integrated set of management functions. According to him, procurement decisions are increasingly becoming intertwined with strategic management and are becoming competitive advantage for various global organisations.
There is therefore no gainsaying that a well-structured contracting and procurement process can have profound impact on a country or a company. “As contract and procurement is involved throughout life-cycle; from product concept, to design, to tendering, to execution, to disposal, etc, it has pivotal position and 360-degree view, which are inbuilt advantages that can enable it provide significant value. Therefore there is no doubt that effective and efficient procurement can help bring public confidence for a government and private sector to grow.”
— Jun 29, 2015 @ 01:00 GMT