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Four Essays On Purchasing And Supply Management

Purchasing And Supply Management Essay

Purchasing and supply management holds a position of the mortar to hold the bricks together in the business world. Within purchasing and supply management, there are a few steps while creating a project supply, service, and material budget from detailed requirements. Those steps show how to select the most qualified suppliers and strategies for negotiating prices. Along with this, there are also benefits and costs of outsourcing. This includes the growth of outsourcing. Various organizations will be evaluated on their benchmarks in purchasing and supply management, along with their best practices in this. There are specific companies out there that who show market leadership in purchasing and supply management.
In some cases the term, “purchasing,” is often limited to the actual definition listed in text and dictionaries. It is limited to just buying and this refers to the location and selection of suppliers, learning of the need for whatever is needed, price negotiation and any terms of agreement, the payment and finally the delivery. In this particular case the term purchasing is referring to the process of and not the act of. “Purchasing, supply management, and procurement are used interchangeably to refer to the integration of related functions to provide effective and efficient materials and services to the organization. Thus, purchasing or supply management is not only concerned with the standard steps in the procurement process: (1) the recognition of need, (2) the translation of that need into a commercially equivalent description, (3) the search for potential suppliers, (4) the selection of a suitable source, (5) the agreement on order or contract details, (6) the delivery of the products or services, and (7) the payment of suppliers.” (Johnson, P. F., Leenders, M. R., & Flynn, A. E., 2010)

Purchasing and supply management is obviously bigger than the traditional term of just bartering with money or services. There are also responsibilities of purchasing that go much beyond the traditional meaning. These can include receiving, storage, inspection, scheduling, materials handling, inbound/outbound traffic and disposal. It may also have responsibilities for certain other components that are part of the supply chain. These can include customers of the organization, their customers, and the suppliers of their suppliers. This is an extension that actually represents the other portion of the definition, supply chain management. This is “where the focus is on minimizing costs and times across the supply chain to the benefit of the final customer in the chain. The idea that competition may change from the firm level to the supply chain level has been advanced as the next stage of competitive evolution.” (Johnson, P. F., Leenders, M. R., & Flynn, A. E., 2010)

As part of purchasing and supply management, there is the supply process itself. It consists of nine fundamental steps in the purchasing process. These steps are:...

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Dell: Supply Chain Management and Electronic Commerce

1499 words - 6 pages Introduction: Dell, one of the largest technological corporations in the world, sells personal computers, software, computer peripherals and other digital products among the world. According to the Fortune 500 list, Dell is currently listed as number 51. Dell is well known for its customer-oriented services such as supply chain management and electronic commerce. More specifically, the supply chain management (SCM) used by Dell allows...

Devising of Optimization Models and Modelling Systems for Supply Chain Planning and Management

1847 words - 7 pages Any software tool that claims to analyze or optimize a supply chain uses this process. The questions we must stay focused on are, "What does the software really do in each step?" and, "What does it expect me to do?" If we keep asking these questions, we can find out the exact value the tool in question adds to the data.We must stay on this message because the supply chain software industry is confusing. Nearly every vendor uses words...

Compare and contrast the supply chain management approaches take by H&M, Benetton and Zara

2717 words - 11 pages The purpose of this essay is to discuss different supply chain management approaches taken by H&M, Benetton and Zara. It is first necessary to explain what a supply chain management means. Supply chain management involves planning, design, maintenance and control of the flow of materials and information...

Weather management can control all the factors influencing demand for and supply of labour.

1361 words - 5 pages This essay will be discussing if management can control all the factors influencing demand for and supply of labour.Management is the process of acquiring and combining human, financial and physical resources to attain the organization's primary goal of producing a product or service desired by some segment of the society. (Longecker:1984:2). However, in this essay, management will be referring to those people at the top of the...

Supply and Demand – Good Life Property Management ECO 360, Economics for Business I

1333 words - 5 pages Supply and Demand - good life Property management this paper examines the economic phenomenon of supply, demand and equilibrium. Using the fictional organization of GoodLife Property Management in the town of Atlantis, the paper will summarize how the supply and demand curve is used to determine the equilibrium in the market for the lease of two-bedroom...

Case Study - Mama Products (customer service strategy, relationship between internal customers and supply chain management, JIT and TQM)

3927 words - 16 pages 1. IntroductionThe purpose of this project is to analyze and evaluate the operations of Mama Products distribution company in respect to several factors: the role of internal customer in the development of effective value supply chain management, customer service strategy, and on the recommendations regarding the possible implementation of JIT and TQM concepts into the company's operation.Throughout the project and the discussion...

Kraljic matrix simplified

2164 words - 9 pages SUPPLY STRATEGY1. Introduction:In many companies, purchasing is relegated to the routine function of an organization and not much attention is paid by the top management to understand the strategic aspects of this function. Threats of resource depletion and raw materials scarcity, political turbulence and government intervention in supply markets, intensified competition and accelerating technological change have...

Purchasing Department

1415 words - 6 pages PURCHASING AND SUPPLY ORGANIZATION DEPARTMENT I contacted a consultant for Mansell Ltd. and a great deal of information was gathered and analyzed. The following advice would be given for ways of improving their purchasing and supply organization. Currently, Mansell Ltd. Operates...

Supply Chain Management--case study on IBM

2354 words - 9 pages 1.0 IntroductionAll business is both customers for some other businesses' product and services, and suppliers of products and services to their own customers or other business. So no operation, or part of operation, can be seen as existing in isolation. Every operation is part of a network of suppliers and customers. In this age of international market and competition, a company's competitiveness rests on its ability to provide desired...

Global Supply Chain Management

822 words - 3 pages The supply chain is a concept resulting from multiple independent entities that affect each other. It is a system made up of many separate units linked together by the process of buying and selling pieces and services that will produce a final product. It is the alignment of firms that bring products or services to market. These entities may be independent companies. The chain can also be within a single firm (Long, 2003).The supply...

What is a buying center. Explain how the prcoess of buying center

1140 words - 5 pages Participants in the Business Buying ProcessWho does the buying of the trillions of dollars' worth of goods and services needed by the business organizations? Purchasing agents are influential in straight -re-buy and modified re situations, whereas other department personnel are more influential in the new-buy situations. Engineering personnel usually have a major influence in selecting the product components, and purchasing agents...

What is Supply Chain Management (SCM)?

Supply chain management (SCM) is the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. It represents a conscious effort by the supply chain firms to develop and run supply chains in the most effective & efficient ways possible. Supply chain activities cover everything from product development, sourcing, production, and logistics, as well as the information systems needed to coordinate these activities.

The concept of Supply Chain Management (SCM) is based on two core ideas: 

  1. The first is that practically every product that reaches an end user represents the cumulative effort of multiple organizations. These organizations are referred to collectively as the supply chain.
  2. The second idea is that while supply chains have existed for a long time, most organizations have only paid attention to what was happening within their “four walls.” Few businesses understood, much less managed, the entire chain of activities that ultimately delivered products to the final customer. The result was disjointed and often ineffective supply chains.

The organizations that make up the supply chain are “linked” together through physical flows and information flows. 

Physical Flows

Physical flows involve the transformation, movement, and storage of goods and materials. They are the most visible piece of the supply chain. But just as important are information flows. 

Information Flows

Information flows allow the various supply chain partners to coordinate their long-term plans, and to control the day-to-day flow of goods and materials up and down the supply chain.

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