5/10/2020

Procurement 2

• PGD in Supply Chain Management

• BIHRM

Agenda
• Analyzing Supply Market
• SUPPLY MARKET: DETERMINING WHAT TYPE OF KNOWLEDGE
TO COLLECT
• Supply Market: Information source
• Supply Strategy: Classification
• Supplier perception
• Gap Analysis

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SUPPLY MARKET: DETERMINING WHAT TYPE
OF KNOWLEDGE TO COLLECT
Macroeconomic
1. Level of unemployment
2. Prices at producer and consumer
levels
3. NAPM Purchasing Manager’s
Index
4. Interest rates
5. Environmental restrictions
6. Changes in import tariffs and non-
duty barriers to imports,
7. Interest rates
8. Changes to taxing
9. Increases in minimum wage rates,
legislated increases for certain
insurance coverage, and various
licensing initiatives.
Supplier-Specific
1. Capacity
2. Product range (including
capabilities)
3. Pricing and profit
4. Capital sources, costs,
and criteria for use
5. Benchmarking partners
6. Technologies
7. Processes employed
8. Management and
ownership
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Industry-Specific
(1) very consistent demand
over time, hence the
supplier can use them for
base loading capacity;
(2) there are other non-price
elements in their
relationship beyond the
obvious single product or
service requirements;
(3) there is an improved
business process between
buyer and seller that has
reduced the costs for both
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Purchaser’s Firm
1. Management objective in 3 to 5
years?
2. needs or potential of
customers?
3. Assessing cost or value needs
of internal customers?
4. New technologies in 3 to 5
years.
5. Opportunities and threats to
customers?
6. Changing drive change of
business
7. Cost & non cost drivers
8. What information need &
sharing aspects
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Supply Market: Information source
• Formal Processes
• daily newspapers
• trade journals. Industry
specific like Chemical
Marketing Reporter, Board
Markets, banking,
healthcare and
transportation industries
specifically
• Electronic News,
• The Wall Street Journal and
Journal of Commerce,
• Annual report
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Informal Sources
- Sales representatives
- Supplier personnel
- Non suppliers, including
competitors as well as
seemingly independent firms
-capacity utilization, source of
supply, process changes,
capital expansion plans
- Needless to say, the better the
relationship with the supplier
representative, the better the
information, both qualitatively
and quantitatively.
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GAP ANALYSIS’’
• Identifying Critical Relationships
• _ How key is this relationship to the major
objectives and goals we have?
• _ Will this be a longer-term relationship or for
a short-term project?
• _ How strong is our relationship today?

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Assessing Personal Strengths and

Improvement Areas
• _ Listening/testing for comprehension: How well
do we really understand what the other party is
trying to tell us? Do we test for understanding by
restating what the other individual has said to us?
• _ Facilitation: How well can we facilitate cross-
functional teams in the accomplishment of their
goals and objectives? Have we learned and
applied key facilitation skills to make our
meetings efficient and effective?

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• _ Change management leadership:

• _ Assessing individual styles:
• _ Negotiation with multiple parties:
• _ Conflict resolution:
• _ Establishing alignment of supply chain
stakeholders:
• _ Corporate culture assessment:

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Steps to Close the Gap in Key Areas

a plan to ‘‘close the gap’’ needs to be

established.
• _ Finding and spending time with a mentor who
possesses excellent skills in these areas
• _ Attending formal training on areas like effective
listening and communication
• _ Reading books and magazines on these topics
• _ Searching the Internet for helpful information and
tools. Making a concerted effort to practice on the
job every chance you have

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• End

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