CH. 10 Sourcing & Supply Management for FINAL EXAM Flashcards
the identification, acquisition, and management of inputs and supplier relationships that a firm needs to attain its strategic objectives.
supply management (also known as purchasing or procurement)
the identification, evaluation, and selection of suppliers.
sourcing
the probability of an unplanned event in acquisition, delivery, and use that negatively affects a firm’s ability to serve its customers.
supply risk
considers all the costs incurred before, during, and after the purchase of a good or service.
total cost of ownership (TCO)
Business practices designed to positively affect people, society, the planet, as well as profits.
Sustainability
acquiring inputs from operational processes done within the firm
insourcing
acquiring inputs from operational processes done by suppliers
outsourcing
the choice between making a product internally or purchasing it from a supplier
make or buy decision
A process that identifies what purchases are being made in an organization.
spend analysis
Purchases that are unique and core to firm’s performance. Represent a high spend level and are high risk.
Strategic purchases
Purchases that are not core to the firm’s performance, but lack of availability can cause delays. Represent high risk and low spend.
Bottleneck purchases
Purchases that involve standard goods or services where many possible suppliers are available. Represent low risk, but represent a high level of spend.
Leverage purchases
Purchases that are a low percentage of overall spend and have little impact on performance.
noncritical items
the determination of the number of suppliers to use
supply base optimization
relationships characterized by distrust and limited communications
adversarial relatonships
