Procurement
Course length
This course is one-week long.
Marks overview
Assignment 1 25% 50%
Assignment 2 25%
Daily activities 10%
Final exam 40%
Textbook
Assignments
Index in the 6th edition
Note: The page numbers in the 7th ed. of the book would be shifted by a few pages
Ch 1 pp. 8—11
Ch 2 pp. 41—45 and 63—73
Ch 3 p. 104
Ch 5 pp. 171—173, 180
Ch 6 pp. 193—204, 227, 228—229, 231, 230—235, 236
Ch 7 p. 264
Ch 8 pp. 285—321, 288, 303
Ch 9 pp. 332—339, 340-342
Ch 11 p. 409, 412—418, 428—438, 458, p. 444
Ch 13 p. 504
Ch 15 pp. 580—581
Ch 17 pp. 691—692
Valuable resources
Tools and definitions
For statistics, tools, country indicators, Project Mgmt tutorials and courses, etc. see
resources
Definitions
“CIPS Australia motivated a debate on an agreed procurement lexicon. The following statements were proposed:
Procurement is the business management function that ensures identification, sourcing, access and management of the external resources that an organisation needs or may need to fulfil its strategic objectives.
Procurement exists to explore supply market opportunities and to implement resourcing strategies that deliver the best possible supply outcome to the organisation, its stakeholders and customers.
Procurement applies the science and art of external resource and supply management through a body of knowledge interpreted by competent practitioners and professionals.
[…]
The author provides two more definitions of procurement.
Procurement is a pro-active, strategic corporate activity to ensure a continuing supply of goods and services to enable world-class organisational performance.
Procurement manages supply chain risks through the effective negotiation of contracts, cost and price models, quality and other essential supply characteristics.” (Lysons & Farrington, 2016)
To supply the organisation with a flow of materials and services to meet its needs.
To ensure continuity of supply by maintaining effective relationships with existing sources and by developing other sources of supply either as alternatives or to meet emerging or planned needs.
To buy efficiently and wisely, obtaining by ethical means the best value for every pound spent.
To maintain sound cooperative relationships with other departments, providing information and advice as necessary to ensure the effective operation of the organisation as a whole.
To develop staff, policies, procedures, and organisation to ensure the achievement of these objectives.
(Baily, Farmer, & Crocker, 2015)
Day 1
Learning Objectives
Analyse the history of purchasing
Understand the importance of purchasing
Describe the stages within the purchasing process
Understand the objectives, which impact purchasing
Explain the various types of purchasing documents (RFI, RFP, RFQ)
Day 2
Learning Objectives
Explain aligning objectives strategy components and their importance
Analyse a supply management structure
Understand category strategy and its impact on supply management and commodity strategy development
Explain what spend analysis is along with the Pareto charts tool
Describe the various steps within the sourcing process
Understand the types of supply management strategies
Extras
Day 3
Learning Objectives
Understand the supplier evaluation and selection process
Analyse supplier scorecards and their application to supplier evaluation
Describe key supplier evaluation criteria
Explain supplier quality
Day 4
Learning Objectives
Analyse cost reductions
Explain price and cost analysis
Describe what total cost of ownership is
Understand cost management
Analyse rationalization and optimization and impact on strategic cost management
Explain what a supplier development process map is and the value of it
Assignment 2 is due today.
Day 5
Works cited
Baily, P. J. H., Farmer, D. H., & Crocker, B. (2015). Procurement, principles & management. London: Pearson.
Lysons, K., & Farrington, B. (2016). Procurement and supply chain management.
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2016). Purchasing and supply chain management (6th ed.). Cengage Learning.