Procurment Flashcards
What is an SSU?
Shared service unit- they handle tasks that are commonly needed throughout the company as a kind of third party resource but are still very much part of the organization (IT, Payroll, legal division, HR)
What are the 5 rights?
Quantity, quality, place, time, price
What is centralized procurement?
When procurement is handled throughout the company by a specialized group of ppl who work to buy stuff and maintain the supply chain for the whole company
What is decentralized procurement?
When the division managers handle the needs of their department themselves and do the purchasing on their own
What are some ways a company can be partially centralized?
Coordinated development- common things needed by the whole company are centralized but things needed by a specific department are bought by them
Consultative centralized- strategic and operational tasks are handled by the SBUs
What is an SBU?
Strategic business unit- a part of a company or brand that operates independently but is still all under one umbrella name/organization (ex: Sony, Microsoft)
How do purchasing departments add value?
By cutting costs and increasing efficiency- making the supply chain leaner, negotiating with suppliers, managing invetory
