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Thus, it makes sense to view it as a cross-functional function rather than a vertical or hierarchical process. Real benefits come from strategic decisions. Previously, the decentralized procurement function was reactive, which means that if they needed something, they would buy it without any real strategy and with very little planning. With strategic sourcing, the company can proactively purchase, resulting in economies of scale, savings, efficiency, faster processes, and strategic relationships rather than transactional ones with suppliers.

All decentralized procurement offices are being consolidated into this procurement division, which includes around 3, people.

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The guiding light for the process is that operations should not be affected. Suppliers complain that the previous process was not efficient. How will this change? In parallel with the integration, we are segregating the different areas within procurement such as market intelligence, administration, cost estimation, and the legal area to increase efficiency.

We need to specialize, create purchasing managers and teams by category to have experts in what we buy, such as drilling equipment, pipes, vessels, etc. For example, in PEP, there are four production divisions, each of which is managed completely separately. As a supplier, you can sell equipment to the northern land division, but to do the same in the south, you have to start the process from scratch.

In the end, suppliers have to knock on more than a hundred doors. The consequence is that many suppliers do not want to do business with Pemex, so the company does not have access to the full range of technologies that can meet its needs. Will Pemex make long-term decisions that are not based on the lowest cost? Over the years, we have created a culture in which suppliers offer the lowest possible price and then modifications are requested during the contract because the total life cycle costs were not considered.

The mentality has to change.

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Previously, each subsidiary and Coporate Operations of Pemex were responsible for their own acquisitions. With this new model, DCPA will assume all those responsibilities and conduct market research, integrate the requirements and then execute the procurement process at the request of users. The intention is to develop a new purchasing philosophy by strategically sourcing through category management, while emulating the best practices and trends found in the international petroleum industry.

As an entrepreneur, Mr. Henriquez successfully created and managed multinational logistics, marketing and real estate companies. It also helps develop standardised and streamlined processes that will create greater capital spending efficiency. These processes are important to the future success of Pemex as it enters a competitive oil and gas environment for the first time in more than seven decades.

The reform was not the reason for the creation of the DCPA, however it has provided additional motivation to implement changes. When you have four subsidiaries that conduct business in distinct manners, it is difficult to monitor how much they spend, as they have a tendency to conduct their activities from a business unit standpoint.

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By building common strategies, our goal is to consolidate the total purchasing power of subsidiaries and convert that into economies of scale and aggregate demand. Restructuring such an unsynchronised system represented an enormous task, as it involved bringing the 3, employees spread across four different Pemex subsidiary procurement divisions, and a further 2, indirectly associated with procurement, into the management of the DCPA.

Ultimately, the company lost out on opportunities to access the necessary goods and services to execute projects. Not only will this allow us to be a conduit to suppliers, but we will also make sure that we strengthen our ties with those suppliers who are reliable.

Arturo henriquez autrey biography channel: Arturo Francisco Henríquez Autrey (representative

What kind of spending patterns will DCPA implement to avoid unnecessary expenses? Our goal is to modernise the way Pemex spends its money. The key benefit provided by the centralised procurement system is strategic sourcing through category management, which helps us to understand and control spending, establishes categories of spending and identifies strategies based on those categories to optimise procurement.