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CHAPTER 1
PRINCIPLES OF SUPPLY CHAIN AND PROCUREMENT MANAGEMENT
• Green supply chain
– National governments across the globe have become
stricter in their environmental regulations. Consumers have also become
more environmentally conscious, preferring to buy goods and services from
organisations that are environmentally friendly. This has influenced the
procurement function in that it too has to consider environmental aspects when
sourcing from suppliers. Organisations are therefore increasingly creating
procurement policies that emphasise sourcing products and services that
are less environmentally damaging.
• Product life cycles have become shorter
– Customers have become more
selective and critical, which requires shorter product lead times and faster,
more flexible distribution decisions.
• Buyer-supplier relationships
– Procurement officers develop and
maintain relationships with their internal and external business partners and
concentrate on strategic partnerships with a few select suppliers. The mutual
benefit of the buyer-supplier relationship is discussed in Chapter 5.
• Procurement contribution to the bottom-line
. Procurement has increased
in importance and has become a strategic function that contributes to
organisational profit [12, 20].
1.14 CONCLUDING REMARKS
Chapter 1 has laid the foundation for what follows in subsequent chapters. It has
discussed the relationship between supply chain management and procurement
management; the principles of supply chain and procurement management;
procurement functions; procurement processes; procurement documents used
and procurement organisations. Procurement management was discussed
from a supply chain management perspective. The key types of products and
services that procurement is typically engaged to procure were also discussed.
The chapter concluded with the importance of supply chain and procurement
management, including key trends and developments.
1.15 REFERENCES
[1]
Croom S.R., Romano P. and Giannakis M., Supply chain management:
An analytical framework for critical literature review, European Journal of
Purchasing and Supply Management, Vol. 6 (Issue 1), 2000, pp. 67-83.
[2]
Li S., Rao S.S., Ragu-Nathan T.S. and Ragu-Nathan B., Development
and validation of a measurement instrument for studying supply chain
management practices, Journal of Operations Management, Vol. 23
(Issue 6), 2005, pp. 618-641.
[3]
Kale P. and Singh H., Managing strategic alliances: What do we know now,
and where do we go from here?, Academy of Management Perspectives,
Vol. 23 (Issue 3), 2009, pp. 45-62.