Purchasing and Supply Chain Management
6th Edition
ISBN: 9781285869681
Author: Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher: Cengage Learning
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Question
Chapter 5, Problem 2DQ
Summary Introduction
To discuss: The benefits of centralized purchasing authority and decentralized purchasing authority.
Introduction: Supply management is the process of managing the suppliers and raw materials or resources that are essential for the organization’s operations.
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Discuss the two or three most important benefits to centralized purchasing authority. Justify your choices.
Discuss the two most important benefits to decentralized purchasing authority. Justify your choices.
You have been made the purchasing manager of a local restaurant. This restaurant is part of a
chain of locally‐owned restaurants that has steadily grown since 2005. Currently, there are 6
restaurants located in Durban, Cape Town, and Pretoria. Answer the following questions with
your application to your new role.
Indicate whether your local restaurant should follow a centralised‐; decentralised ‐
or combined purchasing and supply organisational structure. Justify your opinion
by discussing at least three key points.
Chapter 5 Solutions
Purchasing and Supply Chain Management
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- What do you think is the biggest problem CIOs face in terms of inter-organizational supply chain?arrow_forwardWhat is the effect of behavioral issues in the supply chain decision-making process?arrow_forwardHi there can you please assist on the following question below You have been recently appointed as a Purchasing Manager at Unilever. The director has mentioned that the organisation has recently been experiencing uncertainty in demand and there is currently no available capacity. As such, he is unsure whether he should make or buy the new range of cleaning detergents. Differentiate between insourcing and outsourcing. Discuss at least two circumstances favouring buying (outsourcing) and at least two circumstances favouring making (insourcing). Based on your discussion of the circumstances favouring outsourcing and insourcing as well as the restrictions outlined by the Director, identify whether the cleaning detergents should be outsourced or insourced. Justify your answer by discussing at least two key points. Identify any two potential drawbacks that Unilever could face given their choice of sourcing method.arrow_forward
- How can businesses effectively utilize the push-pull strategy in their supply chain management to balance production and inventory levels with customer demand, and what are the key factors that contribute to successful implementation of this strategy?arrow_forwardFor the strength and opportunities listed below. Create one section for matching strengths to opportunities. Discuss how the company can use the strengths to capitalize on the opportunities. You should discuss every single identified opportunity. Strength: It has a solid foundation of trustworthy raw material suppliers, allowing the business to get around any supply chain bottleneck Neiman Marcus products have a consistent level of quality due to the successful automation, which also allows the business to scale up and down in response to market demand. Neiman Marcus Group also developed a solid distribution network through time that can cover most of its prospective market. Opportunities: Less inflation makes the market more stable and makes it possible for Neiman Marcus Group consumers to obtain loans at cheaper interest rates. The business has made significant financial investments into the web platform over the last few years. With this investment, Neiman Marcus Group now has…arrow_forwardBeing connected, being visible, working together, and getting things done in a timely way are very essential to success. What essential capabilities of supply chain technology may be exploited to drive improvements in the chain, and how could these capabilities be employed?arrow_forward
- Discuss the major difference between cost-reduction and cost-avoidance measures. Why have some described the reported savings in cost-avoidance measures as “soft,” “funny money,” and “easy to manipulate”? When can purchasing take credit for a legitimate cost reduction or cost avoidance?arrow_forwardPurchasing and supply management is an integrated part of an organisation. Select a corporate business/ organisation of your choice. Discuss any 2 elements or tasks of management involved in their business management with an example for each element or task.arrow_forwardDo you agree or disagree that supply chain collaboration canbe classified as transactional, tactical information sharing, orstrategic in nature? Why?arrow_forward
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