Purchasing and Supply Management

Boot Camp for Buyers

Day one — Acquisition Processes and Strategies — 8:00 AM - 5:00 PM

Introductions and Seminar Overview

• Class introductions, formation of teams
• Review of pre-assigned readings

Synopsis of Modern Supply Management

• Supply Chain Management (SCM) defined
• Information, material, product, and financial flows
• Purchasing's critical role in SCM
• Examples of industry "Best Practices"
• Team case analysis

SCM and Purchasing Terminology

• Important Terms and acronyms defined and reviewed
• Team Terminology exercise

Purchasing's Roles and Structure Within the Organization

• Tactical and strategic applications
• Individual roles — managers, buyers, clerical, other functions
• Traditional organizational structures
• Commodity teams
• Centralized vs. decentralized
• Strategic vs. tactical focus

The Purchasing Process

• The traditional process
• Process evaluation
• Creating an efficient and effective process
• Team process re-design exercise

Methods of Executing the Purchasing Process

• Tactical vs. strategic considerations
• Efficiency in small-dollar buys:
  • Deployment of the order release process
  • Electronic commerce enablers
  • Blanket orders
  • Systems agreements
  • Buying consortia
  • Procurement cards
  • Integrated supply systems

Strategic Sourcing Strategies (SSS)

• The steps in the complete SSS process
• Quadrant analysis and supplier relationship positioning
• Strategy implementation: methods and alternatives
• Electronic Commerce: Web enablers for maximizing the value of strategy
• Sourcing and on-line E-commerce exercises (facilities permitting)

Evening case assignment 7:00 PM - 9:00 PM

Day two — Basic Management and Analysis Skills — 8:00 AM - 5:00 PM

Case Review and Analysis

Creating Value in the Definition of Requirements

• The importance of specifications
• Assuring cost-affectivity in acquisitions through design
• Application of Value Engineering skills
• Assuring a final customer focus
• How supply managers add value
• Assuring quality, price, delivery, and service

Critical Analysis Skills

• Understanding a cost vs. price focus
• Understanding the elements of both cost and price
• Price and / or cost analysis: what they are and when to use them
• Applying the elements of Total Cost of Ownership to acquisitions
• Value analysis: key to assuring profits and final customer's satisfaction

Purchasing Law

• Buyers as agents
• Contract law
• Common Law
• U.S. and International laws of importance to supply managers
• Article 2 of the Uniform Commercial Code
• Elements of contract formation
• Essential guidelines in contract development

Supplier Management Methods

• Supplier identification, selection, and qualification
• Metrics for supplier management
• Supplier quality assurance — certification
• Supplier alliances

Evening case assignment 7:00 PM - 9:00 PM

Day Three — Practical Applications — 8:00 AM - 3:30 PM

Case Review and Analysis

Critical Elements for Effective Supply Chain Negotiations

• Negotiating on facts
• The ability to avoiding games and tactics
• The ability to achieving a really mutually beneficial outcome
• Team exercise

Purchase of Capital Assets

• Budget considerations
• Cost characteristics and cost drivers
• Decision-making process
• Service agreements
• Buy vs. lease
• Buying used equipment
• When, where and how to buy
• Team case analysis exercise

Purchase of Services

• Focus on process effectiveness and efficiency
• Supply Chain Metrics
• Organizational metrics
• Functional metrics
• Team metrics
• Individual performance metrics
• Purchasing's value-adding activities
• How to identify non-value adding activity
• The tasks which contribute to organizational profit

Course Summary and Close

• Synthesis and summary of topics