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Effectiveness of Three Aspects of the Purchasing Management

   

Added on  2019-10-30

12 Pages3133 Words145 Views
Running head: PURCHASING MANAGEMENT1Purchasing ManagementName:Institution:
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Purchasing Management2IntroductionThis Paper aims to explore the effectiveness of three aspects of the purchasing management which are the supplier selection criteria, the purchasing costs, and the use of information and communication technologies, the ICT. The purchasing management involves thebuying of the spare parts, services, and the raw materials for the selected organization (Miemczyk, Johnsen &Macquet, 2012). For this paper, Giti Tire Private Limited which is a manufacturing company in Singapore is considered. As a purchasing manager in Giti Tire Private Limited, I will analyze all the aspects of the purchasing process involved in the company.The purchasing procedures differ from one company to another though there are some similar factors starting from the demand and other requirements. The Giti Tire Private Limited is a global organization which engages in manufacturing of tires, has about 3200 employees, and distributes its products to about 130 nations. The company faces stiff competition from various organizations such as Dextero, Runway, and Primewell which also won the awards based on tireproduction. The significant goal for the company is to focus on the customers, to listen, watch, and also learn. On the other hand, the strategies for Giti Tire Private Limited involve delivering excellence and exceed the customers’ expectations to maintain and attract more customers, as well as increase the sales globally.Supplier Selection and issuesIn analyzing the purchasing goals of Giti Tire Private Limited, it aims to establish, manufacture, and sell the tires and the related products to various parts of the world such as the United States, Europe, Indonesia, China, and others. Some of the purchasing needs are that the
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Purchasing Management3Giti Tire Private Limited requires conducting testing, markets and also trading the tires to increase the customer’s satisfaction (Giunipero, Hooker, &Denslow, 2012). The company is ranked among the top in the entire world based on their industry and the quality of the products. The company needs to go global and embrace the pride regarding their services and innovation. The Giti Tire should employ an effective supplier selection criterion to investigate, recognize, and deal with suppliers. A supplier selection criterion allows the company to make use of the financial resources, and in return, Giti will expect benefits as well as a high value of suppliers’ contracts. There are several supplier selection criteria which are common to many companies such as quality and safety, service, delivery, convenience, risk, cost, agility, and social responsibility (Tate, Ellram & Dooley, 2012). Giti Private Limited should select the required suppliers through various ways to avoid issues which arise during supplier selection criteria. First, they should identify the suppliers by obtaining the relevant suggestions from the stakeholders (Spina, Caniato, Luzzini &Ronchi, 2013). Cost and value are best drivers that the company should consider when identifying the supplier. Second, Giti should measure the supply outcomes by considering the risks. At this point, the company should develop an assessment or an audit program for efficiency. Third, Giti should acquire the feedback from the suppliers through questionnaires to identify the niche and examine the supplier’s understanding regarding their operations. Fourth, certification is important since it will strengthen the relationship between the company and the suppliers. This step is beneficial since Giti will ensure that the suppliers are more integrated to the process of manufacturing. Developing partnerships will ensure that Giti will communicate effectively with the suppliers. Finally, the company should ensure that quality is observed for the customers to increase their satisfaction. Therefore, I recommend Giti Tire Private Limited embrace the cost supplier selection criteria. The criterion is
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Purchasing Management4appropriate since it explores the delivery commitment, the services, responsiveness and reliability, and the resource savings of the suppliers. However, the supplier selection criterion is associated with various issues. For instance, companies experience issues when selecting the suppliers hence they have to make critical decisions (Baily, 2013). The theory behind supplier selection complicates the position of a purchasing manager in the company. The CSR issues which prevail underscore the supplier selection criteria hence the interpretive structural theory is employed to validate the process. Giti Tire Private Limited embraces the CSR issues hence should embrace the proposed theory to identify the issues which underscore the supplier selection criteria (Chicksand, Watson, Walker, Radnor & Johnston, 2012). The purchasing managers are obliged to respond and be confident when making decisions which concern the supplier selection criteria. The Giti Tire Private Limited should adopt the gray-based theory in decision-making to solve the issues associated with the supplier selection criteria. The purchasing managers can use the gray-based theory to review the attributes of the supplier selection criteria.ICT for purchasing OperationsAfter reviewing the purchasing goals and needs of the Giti Tire Private Limited as well asother relevant information, it is clear that the company needs to adopt effective Information Communication and Technology to enhance the purchasing operations within the company. Therefore, this paper examines various ICT and their impact on the purchasing operations (Monczka, Handfield, Giunipero & Patterson, 2015). Also, the ICT has direct impacts and mediates the practices which concern purchasing. It is evident that the ICT has positive impacts to the purchasing operations through effective implementation of the practices to enhance efficiency. Some companies use various ICT systems such as Peoplesoft, Arriba, and the
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