Please enable JavaScript.
Coggle requires JavaScript to display documents.
course 2: Procurement Basics - Coggle Diagram
course 2: Procurement Basics
3 Ways For Procurement to Prove Its
Value
Retaining Top Talent
Procurement can aid in retaining top talent by ensuring that the company is using best-in-class suppliers for employee experience
Positioning procurement internally as more of a business partner role and promoting its impact in these three strategic areas
Revenue Generation
expert negotiation skills and eye for the venues offering the best value be useful
Operational Efficiency
wide-scale marketing effort to promote the procurement department to the company
method of internally promoting procurement’s expertise in this area is simply for procurement to make friends in other departments and be good listeners
4 types of items we can classify based on Kraljic matrix
Non-Critical Items
These items are low risk and have a low impact upon organizational profitability. These items are anything related to product standardization, process efficiency, and anything you already have an abundant supply of
Leverage Items
The leverage items are those that have a high financial risk, but a low supply risk. Though the financial impact on the business is high, you can use different considerations and strategies for these items because you have a greater number of options available to procure them
Strategic items
Business activity depends on these items. These are often rare or unique resources, or in other words, high-stake purchases for the company.
Bottleneck Items
These are things where you have low control over the suppliers or lack the ability to substitute and replace products. Anything that has production-based scarcity falls into this category
Procurement is the process of acquiring goods, services, or works from external sources
A supplier is an individual or organization that provides goods or services to another organization
Sourcing is the process of identifying potential suppliers and evaluating them based on factors such as price, quality, and delivery tim
A contract is a legally binding agreement between two or more parties that outlines the terms and conditions of a business transaction
A purchase order is a document that outlines the details of a purchase, including the quantity, price, and delivery date of the goods or service
Request for Proposal (RFP): An RFP is a document that outlines the requirements for a specific project or service and requests potential suppliers to submit a proposal outlining how they can meet those requirements
Supplier Relationship Management (SRM): SRM is the process of managing relationships with suppliers to ensure that they meet the needs of the organization and contribute to its success
E-procurement: E-procurement refers to the use of electronic tools and technologies, such as e-commerce platforms and online bidding systems, to streamline and automate procurement processe
RFQ and RFP
RFP: Base on buyer specification, Suppliers are qualified beforehand, strict buyer requirements
RFQ: Base on buyer problem, suppliers will be qualified afterwards, terms are negotiable
Closing
Management
Awarding
Preparation
RFQ document
Invitation and description
General terms and conditions
.Pricing templat
Pre-qualification requirements and questionnaire
Awarding selection criteria and weights
Different
Procurement Direct: Procurement Direct may be more critical to a company's core operations and may require a more strategic and centralized approach.
Procurement Indirect may be more decentralized and managed by individual departments or teams within the company
Procurement Direct and Procurement Indirect are two different types of procurement
Procurement Direct refers to the purchase of goods and services that are directly related to the production or delivery of a company's products or services.