Procurement and Supplier Management in successful project delivery
- The following work will enlighten the students regarding the role and responsibility of supplier management in the successful delivery of the business projects for various organizations.
It will highlight the need for a good structure of the supply chain of a business in order to cater to the problems and business goals.
- Globalization has made business more competitive and dynamic. All the business houses engage in suppliers for commodities and services to maximize profits and performance. Suppliers are the indispensable part of any business.
- Supplier Management ensures smooth functioning of business processes and activities by dealing with the entire lifecycle of a supplier organization.
- The identification, selection, and management of suppliers with evaluation ensure high value and performance.
- When the supply chain for business is established the two factors are – 1) evaluation of suppliers’ performance. 2) identification of areas of improvement with suppliers.
- In order to get back the utmost output of a supply service – 1) track the record. 2) measure performance. 3) regular communication and feedback are required to improve on the areas by finding a solution.
Role of procurement in successful project delivery
- Procurement is the process of getting the goods and materials in accordance with the need of the company in which the supply chain management transforms the goods into products and distributes them to consumers further.
- The procurement ceases as soon as the company gets the possession of the goods and in order to get profit in the business, the procurement amount must be less than the selling cost. Also after deduction of the cost of processing.
- The project procurement management is there to establish and maintain relationships with vendors of goods and services during the project. It includes procurement processes as part of supply chain management.
- There are 4 steps to the planning the process of procurement for project management and delivery and those are:-
1) Planning – It is the creation of an official procurement management plan. It includes internal procurement and external outsourcing of goods. The potential vendors are attracted by the sample procurement documents. It discusses project scope, schedule, requirements, risks, and budget factors of the project.
2) Selection- It includes a comparison of vendors, advantages, disadvantages, and contractual offerings. Video conferences are being conducted for the bidders to allow and understand the project requirements. Proposals are evaluated and if no proper bid then the team uses online ads to solicit new bidders.
3) Administering – It is an important task. It includes tools and processes to manage relationships with vendors. A system is added for monitoring and control. There are formal inspections, audits, reviews of procurement operations to generate performance reports and feedback. It is managed by supply chain or project management software.
4) Closing- It includes ending of the procurement contract, evaluation of weakness, document processes for future needs and summarization so that negotiations can be done to resolve contract disputes.
Factors for an increasing need for Suppliers Management Chain
- The complexity of supply chains has increased as a result of this a proper management of suppliers is required.
- The scale of the business has evolved and expanded vastly (local and global) level so a managed chain of suppliers is needed.
- In order to achieve a long-term established relationship with the supplier, the management is required.
- Having a competitive market of business the supplier chain needs to be managed in order to stand out in the market.
- When there is a growing risk in supply chains and could be identified easily then management becomes an inevitable part.
- Managing the supply data.
- Increasing the standard of quality of business needs management in supply.
Benefits of a good Supply Chain Management
- A good supply chain manages the supplier base effectively. It increases the complexity of supply chains as the scale of operations of business expands. A well planned and structured supplier management organization manages the suppliers very easily.
- Good supply chain management helps in cost savings by ensuring minimum resources utilized with maximum benefits thereby also keeping a check on the quality control.
- It improves the transparency supply of the business or organization by keeping in check of the lifecycle of the suppliers. When there is transparency in the management of supplies it automatically creates a scope of improvement in areas of performance. Also, leading to the personal involvement of suppliers in the business and designing strategies and improving structures.
- By the creation of KPIs, the supplier performance could be evaluated and assessed.
- After evaluation and improvement in areas that require attention the supplier’s help in designing development programs.
- Complex supply chains may be deteriorated of their quality so a proper management chain helps in assessing and mitigation of supplier risk. It creates value or quality service by devising appropriate risk mitigation measures.
- Supply management improves relationships with suppliers by involvement and building trust and long-lasting relationship as it also helps the business in catering problems and considering strategies.
Role of supply chain management in project delivery
The activities that are part of the developmental programs in the organization includes acts like that of technology deployment, cost reduction programs, deployment of corporate deals, inventory rationalization, etc.
All these activities require special skills and techniques to make a project successful. Therefore business employs skilled laborers to deliver projects effectively with minimal cost otherwise there might be a risk of project failure.
The project manager offers the procurement executive to make a good procurement plan which is effective. So, that there is no failure of effective project delivery.
5 Steps of Supplier Management Process
- Identifying the set of business goals and objectives.
- Criteria for selection of suppliers.
- Negotiation with suppliers.
- Evaluation of performance.
Get Help in Supply Chain Management Essay Writing
The above discussion regarding the role, benefits, and factors of a supply chain management may help you in completing your supply chain assignment and project management assignment writing.
It may also help students in writing an essay on sales, assignment on logistic management, and global supply chain.
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