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What is purchasing?
Perspectives on purchasing
What is purchasing?
Definitions
The classic definition
To buy materials of the right quality , in the right quantity,
from the right source, delivered to the right place, at the
right time at the right price.
To be contrasted with
Modern definition
The process undertaken by the organisational unit which, either as a
function or a part of an integrated supply chain, is responsible for
procuring or assisting users to procure in the most efficient manner
required suppliers at the right time, quality, quantity and price and
the management of suppliers, thereby contributing to the competitive
advantage of the enterprise and the achievement of its corporate strategy.
What is purchasing?
Definition of procurement
What is purchasing?
The evolution of purchasing
The Reck and Long model
Stage Characteristics
Concerned with the five rights which concentrate
1. Product centred exclusively upon the purchasing of tangible products and
outcome dimensions.
Moves beyond a concern with outcomes and begins to
2. Process centred measure the process through which the outcome is
delivered.
What is purchasing?
The evolution of purchasing
Period 1 The early years (1850–1900)
Period 2 Growth of fundamentals (1900–1939)
Period 3 The war years (1940–1949)
Period 4 The quiet years (1947–mid 1960s)
Period 5 Materials management comes of age (mid-1960s–late
1970s)
What is purchasing?
Purchasing and change
What is purchasing?
Master contracts
Electronic purchasing
Profit contribution
What is purchasing?
TQM
JIT
Total cycle time reduction
Long range planning
Supplier relationship engineering
Strategic cost management
Performance accountability
Professional flexibility and development
Service excellence
Corporate social responsibility
What is purchasing?
The status of purchasing and supply management