ABSTRACT
This British Steel case study provides the clearest evidence that privatisation is not always necessary for significant performance improvements to be achieved in purchasing and supply management in state-owned enterprises. British Steel improved its level of purchasing and supply functional professionalism while still in the public sector. By 1988, when the company was privatised, there was already a cost reduction focus prominent throughout the business and an attachment to core competence and outsourcing thinking as the most appropriate mechanism to achieve efficiency gains. It would appear, however, that notwithstanding the high level of dynamic and static efficiency being achieved through functional professionalism in purchasing and supply, there has been little pressure to achieve transformational efficiency through an understanding of supply alignment and procurement competence. This is clearly a function of the maturity and national concentration of the steel industry globally, which sometimes creates restricted competition in supply at the national, if not at the regional or global, levels.
