Purchasing functions

The assessor should establish what percentages of key tollers do have an ISO 9000 series quality assurance system or other. Check whether the purchasing function has copies of certification including scope of certification. 

Preparation of specifications in proper form and/or detail for use by the project team as well as for the purchasing function. 

Once the call for all hands on deck is heard, purchasing project teams will be launched. Multi-functional sourcing teams have been common practice for quite some time - at least for the more advanced purchasing functions. However, even... 

One key success factor is that the purchasing function uses a formal value creation process (Fig. 15.3). This cannot be a mere three bids and a buy exercise. We have found that in order to be effective, the process has to ... 

It is sensible to take the attitude that it must be possible to simplify or substitute inputs. The purchasing function as a whole just has to be determined enough in benchmarking across business units and suppliers. Selecting a few products and comparing them across business units typically uncovers substantial value. 

Once the processes and mechanisms are tested and evaluated, it is important to put the right structure in place for the purchasing function. 

Our current views on how to implement a catalyst supplier accreditation procedure are as follows. A team consisting of representatives of technical, analytical, plant operation and purchasing functions visits with the supplier s equivalent representatives prior to placing a major order, or at certain intervals. The meeting will have the following five part agenda ... 

Provides for the creation and processing of purchase orders. This module manages the purchasing function, beginning with the automatic creation of a purchase order when the reorder point of a stock item is reached. 

Clause 7.4 covers the control of the purchasing function to ensure that purchased product meets the specified requirements. Criteria for the selection and periodic evaluation of suppliers shall be defined and results recorded. The organization shall identify and implement all activities necessary... 

The purchasing function develops rapid communication mechanisms such as EDI and Internet linkages to transfer requirements quickly. These rapid communication tools provide a means to reduce time and cost spent on the transaction portion of the purchase. Purchasers can focus their efforts on managing suppUers as opposed to placing orders and expediting. 

Recent newspaper articles focused on lead paint used on Thomas the Tank Engine toys, industrial chemicals in toothpaste, industrial and not pharmaceutical ingredients in children s medicine, chemicals in children s toys that can convert to harmful chemicals when ingested, and contamination of dog food products all indicate that certifying supplier quality in a supply chain is an important component of the purchasing function. However, in the absence of easy-to-perform quality assurance testing, supplier certification and contract incentives play an important role in guaranteeing product quality. 

Competitiveness of the purchasing function involves measures such as cost, delivery performance, innovation, inventory levels, and so on. In the presence of supplier competition, buyers can use auctions as a filtering mechanism to improve performance. Solving the agency problem effectively is a key issue when managing suppliers. 

Savings obtained by the purchasing function go immediately to the firm s bottom line. If purchasing can reduce the amount paid to vendors by 1,000,000 during a year, the firm has 1,000,000 more in profit. If a firm obtains 1,000,000 more in sales, and it has an after tax profit margin of 10%, then profits are increased by only 100,000. 

In many traditional firms, the purchasing function has long been relegated to the corporate back-40 with little visibility and little consideration of its impact on the bottom line. By contrast, in a number of more innovative... 

The organizational purchasing, contracting, or material management functions must consider safety requirements and standards when ordering equipment, tools, and other supplies. With the exception of certain legal requirements, the purchasing function should never attempt to dictate the... 

Gradually, the number of stakeholders that needed to be involved in the design process increased. In particular, the marketing and purchasing functions and downstream functions like service and asset recovery have been involved early in the design process. Because products are used and need to be disposed eventually, environmental concerns have also added to product design and development complexity (see e.g., [13]). 

Strategic - purchasing function provides competitive advantage, focusing on supply chain logistics and procurement engineering teams... 

Developed by A. T. Kearney, this framework (Figure 8.10) enables a purchasing function to determine its current position, and to assess its potential for future development. 

However, in the conventionai organisation this poses an immediate probiem. Most companies are organised on a functionai basis, in other words, they have created a division of responsibiiity by function, so we might find a purchasing function, a production function, a saies function and so on. Typicaiiy the organisation chart wouid iook iike that in Figure 12.1. 

---