The management task of the purchasing & supply manager (The place of…
The management task of the purchasing & supply manager
A centralised purchasing and supply organisation is especially suitable if the needs of different business units, plants/branches are the same. If the greatest proportion of a business’s purchases is made from a single supplier & if material is of strategic importance.
Advantages of a centralised purchasing & supply structure
Standardisation of purchasing & supply
Cost–saving due to standardisation & volume
Specialisation is possible
The place of the purchasing & supply function in the organisational structure
A combination of centralised and decentralised functions
Each plant or branch does its own purchasing, which means its decentralised
A centralised purchasing & supply function, situated at head office, is responsible for purchasing.
If an organisation has a head office with different business units, branches or plants, there are various options, including:
The place of the purchasing and supply function is affected by two elements
In a business with a centralised purchasing & supply function, the purchasing and supply manager and his/her personnel have the authority & are responsible for the purchasing and supply function
Organising the purchasing & supply function
The place of the purchasing & supply function in the organisation’s structure
Coordination with other functional management areas
The internal organisation of the purchasing & supply function.
Purchasing & supply planning
Entails formulating purchasing and supply objectives & drawing up plans to achieve these objectives.
The planning of the purchasing and supply function takes place at the following levels:
These plans should include the optimal application of resources to achieve the objectives
Purchasing & supply must be managed to ensure that the purchasing & supply function operates effectively and makes the best possible contribution to the profit of the business & efficient customer service.