Архив за месяц: Июль 2013

Business processes of procurement: awareness of the need (part 1)

Tweet Procurement management starts with defining the needs of internal customers and ends up monitoring suppliers’ performance and relationship with them. In this process, there is a number of separate steps, including the description of needs, identification of potential sources, the choice of the source of supply and the determination of essential conditions, follow-up to ensure the supply conditions, receipt of goods, payment to the supplier, and monitoring. In this article we will have a look at two stages in the management of procurement - awareness and description of needs.  

Рубрика: The general information about Procurement | Оставить комментарий

Forward procurements

Tweet Forward procurements stand for buying the feedstock, materials, components, and equipment in the amounts which are bigger than the demand, with essential advancing in time when there is no necessity in these product categories. This kind of procurements lets reduce the negative impact of rising prices on different product categories, also providing protection from the problems rising in future periods gaining the necessary resources. That is why, under conditions of uncertainty, the companies fall back on forward procurements. It deals with retail trade most of all, when some suppliers propose special prices to their most important customers in the end of quarter, in order to reach the objective KPI … Читать далее

Рубрика: Inventory management | Оставить комментарий

Inventory management models (part 1)

Tweet For the purpose of this article, some simple models used for measuring the order size and level of supply are reviewed. The degree of applicability of those varies relying on the dependence of demand and supply use. Dependent demand means that the produced item makes up a part of a bigger assembly or product, and its use depends on production schedule of the bigger part. Independent demand means that the use of storage unit is not determined by production schedule, and is directly related to customers’ orders which are coming independently on production schedule. In this article the easiest way of inventory management is considered: the model with fixed … Читать далее

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Inventory management models (part 2)

Tweet Models with fixed period. Sometimes, it makes more sense to place an order with certain frequency rather than reaching some amount of order. For instance, to divide the work load is easier, when every day, week, month, etc., the employees are directed in order to check certain types of supplies. According to the model with fixed order quantity, orders are placed after reaching the point of repeated order. And in the models with fixed period, orders are placed only at particular time. That is why the level of supplies should be built up so that no deficiency was formed within the period from order placement till lead-time.

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Strategic partnership in purchasing

Tweet For the production of substitute components, equipment, advertisement with the fair market price within the limits determined by technical standards and specifications, purchase executives face the necessity of choosing a vendor of uninterrupted supply of feedstock in their everyday activities. As weird as it may seem, these are suppliers who determine the success of a company project and your own efficiency as a purchase executive. This is why building effective relations with them plays and essential part. There exist two diametrically opposed approaches to building this kind of relations: strategic partnership and fierce competitive procedure. For giving better characteristics on the mentioned approaches, let’s have a look at American … Читать далее

Рубрика: Best practices in Procurement | Оставить комментарий

Sources of information

Tweet One of the basic indicators for professional skills of the purchase executive is the awareness of sources of information upon suppliers. Among the instruments frequently used there are: on-line search, electronic sites and web- sites of a company. Special magazines, advertisements, directory of suppliers and trade stock, negotiations with sales representatives, colleagues, professional contacts and own accounts and records are also related to the information sources. For the purpose of this article, the most wide-spread of the mentioned instruments are reviewed.

Рубрика: Vendor selection | Оставить комментарий

«Extended enterprise» concept. Part 2.

Tweet SCORE program has become a ground for bigger concept named Extended Enterprise.  For better description of this method let’s have a detailed look at what SCORE program is. (Data is based on the results of meetings held in person between Chrysler Company and general managers of their suppliers). The main points of the program are described below.  What SCORE is supposed to work on: * Execution; * Modernization of production process; * Materials; * Technological innovation; * Sales growth of produced output; * Quality of packaging; * Reduction of the car weight.  What SCORE is supposed to work on (2) * Share fraction; * Terms of payment; * Warranty; … Читать далее

Рубрика: Best practices in Procurement | Оставить комментарий

About procurement importance or “the golden rule of doing business”

Tweet Imagine for a moment that you are General Manager of transnational corporation, say acting in more than 20 countries. Field of functioning is characterized by high domestic and foreign competition, certain legislative barriers and extremely demanding consumers. Try to agree that in these circumstances it is getting more and more difficult to cheer the shareholders up with income from dividends. Nevertheless, you are full of aspirations and you are determined to maximally grow the profit of your enterprise. How you would do that? Saying straight, you are facing three alternatives: - lead an aggressive marketing company aimed at the sales growth; -  increase the price of the production of … Читать далее

Рубрика: The general information about Procurement | Оставить комментарий

Concept of «Extended enterprise». Part 1.

Tweet «Extended enterprise» concept has been first developed and applied to the purchase office practice in Chrysler Corporation. It has been done by its purchasing vice-president Thomas Stallkamp as an extended version of SCORE program which has been launched since 1991.  

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Strategic role of procurement

Tweet Today one of the questions at the exam concerning change management was dedicated to some Reck and Long model (1988). It says about turning purchasing into strategic function. Unfortunately, the majority of students and, most bitterly, your humble narrator, preferred to tell about the peculiar features of price formation policy rather than about this fine four-stage model. After having passed the exam I have been reproaching myself for giving my preference to the alternative to the only one (!) question relevant to purchasing to some extent. Still feeling my guilt, I am filling in this gap. So, Reck and Long model...

Рубрика: Best practices in Procurement, The general information about Procurement | Оставить комментарий