Föreläsning 6 Flashcards
What is a sourcing category?
Something that can be grouped. Similar type. IT-services, specific group of metals, etc.
can be grouped in a category tree such as marketing and communication. And this group include separate subcategories such as salespromotion events, market research, sponsoring etc.
The importance of each category tree/sourcing category have a very wide importance.
The first one and most used is the Kraljic matrix/the category matrix
What are the two important factors about the Kraljic Matrix?
- importance of purchasing
- complexity of supply market
What are the four qudrants?
Noncritical items: items we don’t want to spend a lot of time or money on, easy to buy, nobody cares as long as they are there.
Strategic items: difficult to buy and everybody has an opinion how to organize them better
Bottleneck items: difficult to buy, not as important, but we still need to buy them. Troubles ahead.
Leverage items: items we spend a lot of money on but the market is quite easy to navigate. Your bonus depends on them
What is the main criteria for determining the importance of purchasing?
Percent of purchasing turnover. High percent of purchasing turnover will determine a higher importance of purchasing.
What is a helping criteria for determining the importance of purchasing?
Change in turnover.
How much do we change our spending? For example: Fast moving industry → shorter period of change. High change in turnover will determine a higher importance of purchasing
What is supplier power?
In a non-critical position (to the left) you can still find yourself in a difficult situation. For example if we have suppliers that are much larger than our own company, the company might have a lower power position and the supplier a higher power. A product that requires a lot of water for example (beer) will give the supplier a lot of power over the company. Because there aren’t many places you can get water from, either a river or something like that.
What does transactional purchasing methods mean?
Short-term relationship
Emphasis on price and quality
Formal trading, exact contracts
Mostly standardized products
No communication if not necessary
Kraljic: leverage and non-critical
What does relational purchasing methods mean?
Long-term cooperation
Key suppliers
Not everything is in contracts
Intensive communication
Kraljic: bottleneck and strategic
Give examples of some transactional purchasing methods
Classic RfX: Request & compare offers from multiple suppliers
Pick supplier with the lowest price
Creative inquiries: Complex solutions from the supplier
Make or buy (INsourcing/OUTsourcing): Purchase from supplier x use own manufacturing capacities
External purchasing: Outsource simple purchases
Automation, electronization: E-catalogues, Automation of standardized items
Standardization: Unification of items
Purchase higher quantities of a smaller number of items
Supply base optimization: Reducing or enhancing the supplier mix
Purchasing alliances: Joint purchasing with similar organizations or within holdings
Total cost of ownership (TCO): Uncover hidden costs by including costs that occur during ownership of the item (e.g. training, insurance)
Opportunistic purchasing: Exploiting short-term market opportunities
E-auctions: Suppliers directly compete (by competitive bidding) in an electronic environment
What are some relational purchasing methods?
- Vertical integration: Assume partial or complete ownership of the supplier
- Early supplier involvement: Supplier is involved in e.g. product development and suggests savings/innovations
- Supply risk management: Evaluating the pros and cons of having global supply chain, joint activities to manage risk with suppliers
- Profit sharing: Share profit (or margin) on the final product with supplier
- Open book policies: Sharing data in the supply chains, e.g. cost breakdowns.
- Target costing: Cross-functional teams assess potentially cheaper alternatives to existing components.
