|The company's Purchase head just couldn't handle it. He had more than 200 PO's to be signed everyday from a Rs10 pin to a Rs 5 lakhs pump. The important aspect is that while Purchase is to focus on bringing the cost of its strategic spend down, most of the time is spent on clerical and non strategic activity.
The recent economic recession didn't help either as most of the purchase departments are lean and lacking manpower to cope with the increase in supply requirements. It is really not about costs, as much as about the nuisance this 5% cost cause in strategic sourcing.