Quản trị kinh doanh - Chapter 2: Purchasing decisionsand business strategy

1Chapter 2:Purchasing Decisionsand Business StrategyPurchasing and Supply Chain Management, 3rd edition, W.C. Benton, Jr., Copyright 2013, All rights reserved PreviouslyIn most industrial firms,material constitutes 60–80 percent of the total revenue dollars.Competitive leverage can be developed through purchased inputsLink the competitive strategy with the purchasing policy2Components ofPurchasing StrategyPurchasing actions are determined by the firm’s competitive prioritiesits resource capabilitiesthe environmentPurchasing strategy must consider competitive prioritiesorganization’s strengths and weaknessescompetitive environment3Example4Purchasing/Buying CriteriaMust reflect firms’ competitive prioritiesExample:Cost priorityhigh priority to purchasing costsFlexibility priorityhigh priority to lead time in buying material5External Environment Environmental FactorsInflation rateMonetary policyFiscal policiesTechnological developmentIndustry capacityMarket growthGlobal stability6Supply Chain StrategyReasons for the emergence of supplier partnerships as a competitive weapon:Increased competitionDeregulationRelaxed antitrust requirementsIncreased use of electronic data interchange (EDI) Increased just-in-time (JIT) manufacturing7Supplier PartnershipsCompanies participate in a variety of supplier relationships and rolesA supplierA customerAn end-user of productsSupplier partnerships can be categorized using five factors:(1) degree of risk/reward(2) type of relationship(3) information(4) planning(5) asset ownership8The Integrated Buying ModelIn buying decisions,multiple goals must be satisfied within the constraints9CostQualitySupplierLead TimeThe Strategic Sourcing PlanThe purchasing function must be integrated into the firm’s overall strategic plan.A strategic sourcing plan requires:A complete understanding of corporate strategies and marketing plans An extensive evaluation/study of current suppliers, how performance is measured, and the expectation of suppliers relative to the industryStudy of the degree of global purchasing opportunitiesIdentification of total costs associated with current purchasing department/ function, budgets, staffing, and so forth10Questions?11