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The management task of the purchasing & supply manager (The place of…
The management task of the purchasing & supply manager
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.
Purchasing & supply planning
These plans should include the optimal application of resources to achieve the objectives
The planning of the purchasing and supply function takes place at the following levels:
Entails formulating purchasing and supply objectives & drawing up plans to achieve these objectives.
Organising the purchasing & supply function
The internal organisation of the purchasing & supply function.
Coordination with other functional management areas
The place of the purchasing & supply function in the organisation’s structure
Cross-functional teams.
The place of the purchasing & supply function in the organisational structure
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
The place of the purchasing and supply function is affected by two elements
If an organisation has a head office with different business units, branches or plants, there are various options, including:
A centralised purchasing & supply function, situated at head office, is responsible for purchasing.
Each plant or branch does its own purchasing, which means its decentralised
A combination of centralised and decentralised functions
Advantages of a centralised purchasing & supply structure
Specialisation is possible
Cost–saving due to standardisation & volume
Standardisation of purchasing & supply
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.