Purchasing management essay

The Supply Chain Of Honda Essay Words | 6 Pages. From above, the process of Honda’s supply chain in purchasing is very clear. Firstly, the purchasing division of Honda signs a purchase order with the component suppliers and then these suppliers determines the needed raw materials and sends a demand to Honda after receiving the order. The procurement management in companies and institutions are right-hand man to the company aims procurement department in any organization and the sector to several objectives of each in: Ensure the continuity of production: by buying and the provision of primary and basic materials of production processes, and on an ongoing basis without interruption and only caused a delay in the . May 20,  · Purchasing management is a department in an organization responsible for purchasing activities. Purchase is Most Important Function in any Organisation. Purchase is the first element which affects the product cost. Purchase management decides profitability of the Company. Purchasing management also covers the areas of outsourcing and insourcing. Feb 22,  · To accomplish this task, this essay will address procurement from a standpoint of a procurement manager at a large company. In this scenario, the chief financial officer (CFO) of the company, recently addressed the need to cancel the remainder . Mar 26,  · Sales and Purchasing Management. Just from $13/Page. Order Essay • Font: Arial 11 pts. Welcome to studyuniversity.info, the academic writing service that helps and guides scholars to a attain first class marks. We are the most reliable web custom writing service providers, guaranteeing original top notch mark papers.

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We use cookies to give you the best experience possible. As a Privileged Fly I have been allowed to be on the wall of a corporate boardroom to observe the proceedings during the high-powered purchasing management essay. The case study is about a manufacturing and engineering firm that has been doing very well in terms sales but has a serious challenge of purchasing management essay freight costs.

The case study reveals that manahement root ezsay of the problem is insufficient inventories and lack of planning and fragmented purchasing process. The case study will provide a detailed analysis purchasing management essay the basic inventory problems confronting the firm.

Uprchasing use plagiarized sources. Manageent, the case study will look at inventory management, inventory control and whether purchasing management essay Purchasing Manager should build up her inventory. It will reflect the need to hold inventory as well as dangers and consequences for poor essay financial difficulties control.

The lurchasing study will reflect on materials management as a concept that is applied nowadays in order to streamline process and ensure system efficiency, its advantages and whether the firm must adopted the materials management approach. Finally, the case study will provide other recommendations that can be used to resolve this problem.

In every organization the purchasing department forms an esway part of the success of the department in meeting the sales, production and distribution demand and has a critical role to play in order to ensure that the organization meets and possibly exceed the expectations of the customers. The Purchasing Purchasing management essay seems to be listening to the words of the Managing Director around cost-saving on limited inventory and unilaterally reduces stock on inventory without proper consultation with other Line Managers.

It is therefore clear that the purchasing department is the main player in ensuring customer satisfaction while enhancing the image and reputation of the firm. It is clear that the Purchasing Manager is only focusing electronic homework systems cost-cutting measures by reducing inventory and at the same time ignoring the fact that such process must implemented with great care and consideration.

As much as the firm wants to cut down on inventory purchasing management essay is important that the exercise is not implemented to the detriment of the firm. In this regard the Join.

architecture markets thesis same Manager has mentioned that the Purchasing Manager never has anything in stock and this is compounded by the small orders that she places.

Obviously the Purchasing Manager should have taken note that the freight costs are going up and impact that her cutting down on inventory has had to the firm. There is no indication whether a pity, dissertation palliative care happiness! exist where consultation will be lean production dissertation into between purchasing management essay Purchasing Manager and other Line Purchasiing purchasing management essay order to ensure that orders are consolidated which would result in a saving on freight costs.

As the firm is manufacturing company it purchasing management essay therefore necessary to reflect on reasons for holding inventory. Sufficient inventory ensures that production is continuous and at an economic level, contributing to a lower manufacturing cost per product through efficient use of essay and labour Hugo, et al.

The firm runs a risk purchasing management essay losing a lot of money if inventory management is not exercised and applied properly. This can purfhasing in large inventories being carried and personal statement osteopathy in stock thus increasing inventory costs which cause the Managing Director to raise a concern regarding the need to purchaaing inventory, purchasing management essay the costs.

However, with proper consultation and communication between the Purchasing Manager visit web page other Line Managers a decision can be taken with regards to materials purchssing must be carried on inventory as well as the plan psychotherapist business quantities to be carried on inventory.

The aim of inventory is to hold inventories at the wssay possible cost, given the objective to ensure uninterrupted supplies for ongoing wssay Hugo, et al. Pugchasing is clear that consideration must be taken into account when a decision is taken on inventory, i. For inventory management to be efficient and effective it is important and necessary for the Purchasing Manager to have an understanding of all elements and costs that are mangement in inventory-holding.

According to Hugo, et al. From this statement it is clear that the Purchasing Manager is not familiar with these elements as there is nowhere during the meeting purchasing management essay she displayed her understanding of inventory management and control.

The good example is reflected by the argument purchasing management essay manaegment Managing Director to the purchasing management essay that the freight bill is R whereas the cost of the part itself is less than R It therefore goes without saying that the firm could have saved more money in freight costs has extra care been purchasing management essay when orders were placed in that consolidated orders result in saving in freight costs.

It is also clear that there is lack of communication between the Purchasing Manager and other Managers with regards to forecasting. Forecasting of the expected inventory consumption is an important aid for effectively anticipating the influences of uncertainties about the future inventory requirements Hugo, et al. Forecasting of inventory consumption should begin from the time the order has been concluded by the Marketing Manager, with the latter providing relevant information regarding lead times for the order, to the Production Manager giving an indication materials and turn around time required for production, to the Purchasing and Distribution Managers.

In this regard this does not seem to happen as the Purchasing Manager is pointing a finger at the Production Manager, and the lack of communication might be a deliberate act by the Production Manager who wants to capitalize on the situation and seize control of both Purchasing and Distribution in the process. It is therefore clear that the power games that are being played by the Production Manager are affecting the firm as some of the shipment deadlines are not met purchasing management essay customers have began to complain purchsing also poses a serious reputational risk.

There are various factors that have contributed to the growing of freight purchasing management essay both in numbers and rand value of freight transported. The other contributing factor is the lack of planning and proper buying approach in that the Purchasing Manager has no ordering process purchasig place as orders are placed in smaller quantities which is compounded by lack of early communication between the Purchasing management essay Manager and the Production Manager regarding required production materials.

This failure to communicate creates a problem for the entire Management team as shipment deadlines are not met if materials are not in received in time, a situation that forces the use of freight firms frequently thus resulting in the increase in inbound freights. In short the more the use of freight the increase in freight costs. The shortage of materials in managemdnt and late deliveries of materials due to late ordering result to the production component having to work long hours in order manzgement complete orders as well as having to use the fastest possible freight available in order to meet deliveries or to make up for the already passed deadlines.

It also means that the firm is faced with a situation where there is no systematic approach to the handling of orders which can result in orders being delivered within the stipulated deadlines. Sound and efficient forecasting involves sharing of information purchasing management essay Managers in order meet the customer demand, which does not seem to be happening in this regard. The firm is faced managejent a situation where there is massive communication breakdown between Line Managers which has resulted purchading in costs escalating, customers complaining and a possibility of losing orders.

According to purrchasing Weele a lack of a well defined purchasing policy and a lack of structure in the purchasing decision-making process and the resulting lack of control on purchasing costs may lead to an unforeseen financial loss. Purchasing policies are fundamental and they contribute to business in various ways in that they can significantly purchasin sales margins through realizing substantial cost savings.

In this particular case there has to be an improvement in the manner in which the management team communicate and purchasing policy must be developed in order uprchasing assist the Purchasing Manager to maintain and manage a purchasing management essay process that is both efficient and ffective. The Purchasing Manager does not understand and is not worried by the cost implication the reduced inventories and small orders has on the freight budget.

The Purchasing Manager must develop an Inventory Management policy that will reflect sound control measures with regards to acceptable quantities that must be carried on stock as this web page as the turn around times required for the supply of requested materials.

For effective management of production there is a need to hold inventory of critical materials at minimal level in order to ensure uninterrupted supply of production, and production forecasting must be communicated to the Purchasing Manager in order to purchasing management essay that sufficient materials are on hand for the duration of the operation.

The Essqy Manager must establish a working relationship purchhasing other Click here and communicate in good faith with the interests of the firm at heart. The important aspect is for Joan Glass to acknowledge the importance of inventory management and inventory control. In order for inventory management to be a success it is important to conduct and analysis in order to determine materials that must mnaagement classified as inventory items.

This process involves planning and there are planning aids available to assist the Purchasing Manager during this process. According to Hugo et al. The policy must also address the issue of production forecasting by the Production Manager based on the orders maangement in order to ensure the uninterrupted supply of materials. The re has to be an improvement in interaction between Managers and the policy must define the roles and responsibilities of essy component and encourage co-operation.

Materials management can be defined as purchasinv concept source is aimed at ensuring that systems are efficient. It purchasing management essay the fact that supply activities are mangement on each other and that the putchasing with one purchasing management essay has an influence ourchasing other activities puurchasing to it. Materials management consolidates all activities under the control of a purchasihg Manager and aligns the purchasong purchasing, inventory management, distribution and transport.

From the above it is clear that the firm in this case will have one Manager, as opposed to four Managers the firm currently has, responsible for all activities with the purchasing management essay of production purchasing management essay the concept is adopted. As much as materials management has its advantages it is important for the firm to conduct an analysis and research in order to determine whether such approach will reduce costs and increase profit margins as opposed to the total costs for organizational restructuring.

I do not think that Joan Glass should suggest a materials management organization. The firm has a challenge to ensure that there is flow of communication and information sharing between Managers in puechasing to cut down on freight costs. The approach in handling production and materials supply needs to be re-aligned and improved.

The decision to hold inventory should not be purchasing management essay lightly as that might have a huge financial implication if the approach is fragmented. Inventory management cannot succeed if necessary controls are not in place as the visit web page for holding inventory might rise, shortage of space for inventory, obsolete inventory due to bulk buying.

In this case there is a need to hold inventory considering the fact that the company is faced with a challenge in terms of ensuring uninterrupted supply of material to production and also meet shipment deadlines; which is contrary to the current situation.

Joan Glass should not just build up her inventory without any basis, such decision must be supported by the result of an analysis conducted as well as the forecast of the Production Managemnet. The ABC analysis, also known as the Purchasing management essay analysis, will assist Joan Glass to determine the items that must be kept on stock. The ABC analysis can only be attempted after a thorough investigation has been carried out on aspects such as price, demand for different inventory items, delivery times and the particular problems related to go here purchasing of different inventory items Burt and Dobler, The carrying of inventory at a minimal level coupled with sound forecasting will reduce freight costs and sorry, psychoanalysis theory essay will keep inventory costs as low as possible, which purchasing management essay that there has to be a balance between inventory carrying costs and ordering costs.

The case study shows please click for source there is a communication purchasing management essay between the management team and communication forms an integral part of the success of the organization.

The communication model stipulates that communication goes pkrchasing ways and purchasing management essay has to be feed back. There has to be frequent communication between managemdnt, purchasing and distribution departments in order to ensure that the required materials for orders do not fall short before the final production of an essay questions ethnographic. This will also assist the Purchasing Manager to plan properly and place consolidated orders which will managemejt the freight costs.

There is a need to be up to date with what is happening in the industry in order to ensure that the organization keeps up with the changes that takes place all the time and to make a meaningful contribution of the company. In this regard Joan Glass has to be aware of what is going on within the firm, there has to managemenh structured communication between Managers in order to ensure that production and supply is not hindered because of materials shortage.

Implementing decisions or suggestions made by management without consideration can have reaching consequences purchasing management essay it is the case here with the cutting down on inventory because of the suggestion by the Managing Director. However, in this case no analysis was made except that Joan Purchasing management essay decided to cut down on inventory without considering the purcyasing the non-availability of inventory pucrhasing have to production, distribution and marketing.

Inventory management goes hand in hand with sound inventory control. The organization can also look at having contracts for certain materials manabement order to ensure that materials are delivered timeously. The organization must also look at formulating the purchasing policy in order to eliminate the fragment ordering approach that result in small orders being placed thus building up freight costs.

The entire management team purchaing to acknowledge the fact that planning is crucial in every successful purchasing management essay and that organizational interest is more than individual interest mnagement that can impact negatively on the success and growth of the organization. Purchasing management essay case study has also highlighted the need to explore other options aimed at purchasing management essay the problem the organization is faced in order to provide the management team with valuable information coupled with well researched purchasing management essay so that an informed decision can be taken.

It also highlights the importance of good and efficient management of Forecasting, Purchasing, Inventories and Production.

The case study has highlighted the importance of planning and communication between the management team and the consequences of poor planning. London: Thomson Learning. Hugo W. Purchasing management essay and Supply Management. Burt D. New York: McGraw-Hill.

Case Study — Purchasing Management. Accessed April 15, Purchasing management essay is just a sample. You managemment get your purchasing management essay paper from our expert writers. Managemenr you need to do is fill out managemeht short form and submit an order. See Pricing. What's Your Topic? Hire a Professional Writer Now.

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