IBM says it is moving its global purchasing headquarters from Westchester County, N.Y. to Shenzhen, China effective Aug. 1

John Paterson, vice president and chief procurement officer for IBM, will re-locate from Somers, N.Y., to China, and run IBM's Global Procurement operations from there. It is the first time IBM has located the headquarters of a global corporate function outside the U.S.

The move is designed to help IBM capitalize on the opportunities in China and help shape them by developing stronger more collaborative partnerships with suppliers.

"China is clearly an area of great importance both today and going forward for IBM and for us as buyers. The move will help ensure we are able to participate fully and take advantage of all the opportunities in the region," Paterson says.

IBM has been sourcing in Asia for 40 years. Over that time, the electronics component supply base has expanded from Japan to Korea to Taiwan and now is moving to China and other parts of the world. "That is a strong reason for getting more tightly connected to the supply chain in that region," he says.

Given the importance of the Asia-Pacific region to IBM, "I think we will make a lot more progress more quickly if the headquarters of the procurement organization is in China as opposed 10,000 miles away," says Paterson.

He adds IBM is also moving to China to develop more services suppliers to support IBM's growing global services business. Such services run the gamut and including software development services and labor.