Procure-to-pay: Strategic sourcing Flashcards
1
Q
Goals
A
- efficiently plan long-term purchasing
- achieve cost savings and improved service levels among their suppliers
- determine the best sourcing strategy
2
Q
Inputs
A
- customer demand
2. new product comes to market
3
Q
Outputs
A
- contract with a supplier
2. supplier relationship
4
Q
Main phases
A
- Assessment of requirements and spend
- Identification of suitable sources of supply
- Negotiation
- Contracting
5
Q
Main activities
A
- Analyse spending
- Identify material
- Determine source of supply
- Publish request for quotation
- Evaluate and select suppliers
- Conclude purchasing contract
6
Q
Resources used
A
- Marketplace (alibaba)
- Human
- Products
- ERP system
7
Q
Org. unit affected and roles involved
A
- Purchasing dpmt
- Suppliers
- Manager (approve contract)
8
Q
KPIs
A
- contract spend ratio
- number of suppliers
- goods returned
- on-time-delivery
- quality of goods received
- costs by suppliers
- flexibility in deliveries and payments (discount period)
- contract duration by suppliers
…
9
Q
Data created and used
A
=> Master data:
- product and price list
- supplier
=> Transaction data:
- request for quotation
- quote
- contract
=> Analytical data:
- spend analysis report
- KPIs and reports
10
Q
Value created
A
- goods received
- supplier relationship
- improving sourcing strategy
11
Q
Direct procurement
A
raw material / components (used in production) or trading goods (sold to cust.)
12
Q
Indirect procurement
A
- maintenance, repair and operations materials
- capital goods and services
13
Q
Tasks
A
- analyse your company’s spend
- search and identify new sources of supply
- negotiate and monitor purchasing contracts
14
Q
Sourcing strategy
A
=> divides total spend into categories
=> defines per spend category
15
Q
Categories
A
=> number of suppliers (single, dual, multiple)
=> geo location of suppliers (local, global)
