1. New Directions of Procurement and Supply Chain Management Submitted By Ahmed Ali (860828) Ali Ammara (860657) Ali Dow (862247) Submitted To Prof. David Burnell April,28,2010
2. Introduction procurement function is part of logistics system. Procurement is one the important activities of the supply chain. Procurement plays an important role in achieving the organization goal. Buying is an important role in the profit of the organization.
3. What is the supply chain planning. Classifications of procurement activities. The role of procurement within business organizations The objectives of procurement and supply The procurement procedures The selection and evaluation of a supplier The benefits and disadvantages of buying The logistical organization of procurement processes Strategy of Logistics
4. What is Supply Chain Planning ? Supply Chain is a set of activities (e.g. purchasing, manufacturing, logistics, distribution, marketing) that perform the function of delivering value to end customer Traditionally, all the business units along a supply chain have their own objectives and these are often conflicting There is no single plan to carry out supply chain activities
6. The Role of Procurement within Business Organizations The procurement function is one of the business functions The procurement function is required to support the labor productivity. The procurement function play an important role in managing manufacturing abroad.
12. More detailed level Purchasing policies (manual) Selection of suppliers and awarding contracts Review material specifications and purchase orders Policies on Public Tenders Policies relating to ethical practices
13. Procurement Procedures Represents the general framework and direction of the actions . Represent the means to run the input information from outside the organization. Procurement cycle. Feel the need. Check the availability of appropriations.
15. Triangle Logistics Strategy Inventory • demand forecasting • Principles of Storage • resolutions of the stock • purchasing decisions and scheduling of supply • Resolutions Storage Customer Service Goals * Product * Logistics service * Information system Transportation • Principles of Transport • resolutions of the Transport location • Location decisions • Logistics network planning process
16. Purpose of Procurement Flow of raw materials and services. Level of inventory investment. Level of service. Competitive situation. Goals of the organization.
17. How to choose a supplier? 14 Steps to choose a supplier: Lead Time Lead time variability Delivery time Delivery time variability Communication Ability to send
18. Vendor errors. Maintenance. Quality Price Experience Terms of contract Services after sell Confidential data
19. Evaluation of the supplier They are several criteria to measure the performance of suppliers, such as: Effect the price Saving
22. The Benefits of Purchasing and Supply External Economies of scale Risk reduction Reduce the capital invested Focus on the goal of the organization Increased flexibility
23. Disadvantages of Purchasing and Supply the Outer Lack of knowledge of competitors Collision targets A system for integrated logistical
24. Logistical Organization of Procurement Processes Structure and control Centralized structure for decision-making. Cost analysis for decision support site. Cost of holding inventory, costs and interest of the process of delay. Re-evaluation of global logistics network.
Buy-back or returnAllows a manufacture to return non product inventory up to a specified amount
To identify the role of procurement within business organizations, we should know that:
Five commitments or rights by five to get on the needs of the organization of materials, parts and equipment: Appropriate quality The right amount The right price Timely The source of supply appropriate
Aims to achieve main purposes Represents the general framework and direction of the actions necessary to complete the required activities of the management and materials efficiently.Represent the means to run the input information from outside the organization.Procurement cycle.Feel the need.Check the availability of appropriations.
Provide a flow of raw materials and services required for the various operations within the organizations.Maintain the level of inventory investment.Improve the level of service. Choose the best suppliers. Standardize of the various units. Improve the competitive situation of the Organization. Implement the goals of the organization.
When you choose the supplier you should link to the several factors complicated. that There are 15 step when selecting the resource:
Suppliers are evaluated according to measure the performance of each supplier separately. Used several criteria to measure the performance of suppliers, such as: Effect the price The unit price and the in accordance with the market price, unit price and in accordance with the competitors.Saving Discount on large quantities
Control Track the arrival of goodsThe material flow There are no obstructions preventing the flow of goodsDelivery The arrival of the goods without damage in a timely mannerPlanning to predict the price and demand
There are several types of contracts with suppliers: Procurement contracts recoveredallowed to retrieve the remainder of the goods Partnership contracts in the flowallowed for the resource Distributed organizations in profits Contracts amountsallows the Organization to amend the quantity required by the application
Structure and controlIf the goal is to achieve trade-offs expected from the use of outsourcing from abroad in the production and distribution across international borders, it is necessary to establish a centralized structure for decision-making.In global manufacturing is the use of cost analysis for decision support site.Accurate information on the cost of holding inventory, costs and interest of the process of delay is one of the key variables in the site selection process.Site decisions taken in a central web only.Re-evaluation of global logistics network provides a tremendous opportunity to reduce taka life and improve efficiency In the output
Sense to focus on the range of activities in the value chain which has a unique competitive advantage to the company, and are outsourcing from abroad for the rest of the activities
Logistics informationGlobal logistics management are in fact manage to force information. Organization that is looking for global leadership in the field of business based on a vision of which can be obtained for entry into force of material, stockpiles, and demand along the channel of supply. Time-delay in the flow of data translates directly to the inventory Quick response logistics depend on the flow of data from the point of actual demand and directly to suppliers and systems re-supply. There is an urgent need for information system can read the request at every point in the channel for the supply provides the ability to control the central system in logistics
