Purchasing portfolio matrix

Diversify suppiy base Expioit suppiy base Baiance suppiy base 

Finally, if neither the buyer nor the supplier can attain an advantage over its counterpart, the logical consequence is a balance strategy. 

A modification of the Kraljic matrix (that is believed to be a beneficial improvement) is made by Gelderman and van Weele (2003). Here, the balance strategy is developed in greater detail (while the other two are held constant). A distinction is made between the conditions depicted at the bottom left and the top right in Fig. 5.5. If the power of both parties is equal at a low level, systems 

Park et al. (2010) have developed a framework with an integrated approach to supplier relationship management. It manages to combine purchasing strategies, considerations for suppliers, collaboration in product development, production activities and supphers assessments. In the following this framework is shown on the basis of a supplier assessment and development. 

Supplier assessment and development arms to assess the supplier segments and to differentiate them. Supplier segmentation determines the strategic importance of materials to establish a functioning relationship and also evaluates the supplier. 

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Purchasing Portfolio Matrix 40 8.77 Quality Mgmt Techniques 5 1.10... 

Segmentation of Spend Purchasing Portfolio Matrix Pareto Analysis QV Methodology 8.77 2.41 0.44 11.62%... 

Project Management Techniques 7.20 27 73 2 Purchasing Portfolio Matrix 8.77 33 67... 

Input from other CMs Purchasing portfolio matrix (1A)... 

This section deals with the role different suppliers play within a firm. In a first step, the presents of different supplier bases is evaluated. Moreover, some general questions are presented about supplier segmentation. Second, a questionnaire is presented to classify a company s AS-IS suppliers based on a purchasing portfolio matrix developed by (Kraljic 1983). 

In this context, Kraljic introduced in 1983 the purchasing portfolio matrix which groups the procured items into four categories positioned alongside the two dimensions ... 

A number of approaches seek to segment suppliers into categories. The purchase portfolio matrix presented in Figure 9.2 is based on the notion that a customer will seek to maximise purchasing power when it can. This approach assumes that the key factors that affect the relationship are the strength of the buying company in the buyer-supplier relationship, and the number of suppliers able and willing to supply a product in the short term. 

Selecting an organisation of your choice, use a copy of the purchase portfolio matrix (Figure 9.2) and plot on it the names of its top 10 customers and top 10 suppliers. Which position would your chosen company prefer to be in Suggest actions that would make the situation better. 

Figure 10.5 Purchase portfolio matrix.(Adapted from Kraijic P. Purchasing Must Become Supply Management Harvard Business Review, 1983.)...

How can the purchase portfolio matrix be used First, segment purchased goods and services into one of the four quadrants. Once the purchases are segmented, develop the appropriate purchasing strategies, policies, processes, and relationships. 

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