Trends in Procurement Scm
TRENDS IN PROCURENENT AND SUPPLY CHAIN MANAGEMENT
1. Introduction
Procurement and Supply Chain Management (PSCM) presents the new paradigm in strategic and operational business management for the 21stcentury. By offering a cooperative and integrated model of the value-creation process in a cross-organizational perspective, it also places new challenges on business management methods and instruments used, in theory as in practice. In the field of materials management, the new PSCM perspective led to major changes in the methods used and in the emphasis of the different process steps. Presented here is the classical as well as supply-chain-based Procurement methods which compares them and draws conclusion on their use in theory and practice.
Procurement was long neglected by business management and economic theory. The role of Procurement & Supply chain was always seen as a secondary activity in the organization and its supportive role to production were encouraged in classical materials management. In the recent years SCM has been re-evaluated in the value chain of whole industries and therefore reemphasized the strategic role of Procurement for the supply chain. Procurement & supply chain mamagement is divided into 5 steps or activity fields: supporting activities, sourcing, distribution, storage and disposal.
PSCM changed the methods used in each separate step. In supporting activities for example PSCM requires multi-dimensional, long-term and dynamic instruments to guide decision-making in materials management, using cross-organizational cooperation to succeed, such as advanced purchasing. In sourcing the strategic role of sourcing was reemphasized by SCM and new tools such as the use of procurement E-AUCTION methods, SCR, green sourcing, TCO, Ethical sourcing, PCB, strategic alliances and TPB were introduced, due to the new cooperative paradigm in SCM. In distribution and storage too, cooperative instruments are used to keep up competitiveness,
1. Introduction
Procurement and Supply Chain Management (PSCM) presents the new paradigm in strategic and operational business management for the 21stcentury. By offering a cooperative and integrated model of the value-creation process in a cross-organizational perspective, it also places new challenges on business management methods and instruments used, in theory as in practice. In the field of materials management, the new PSCM perspective led to major changes in the methods used and in the emphasis of the different process steps. Presented here is the classical as well as supply-chain-based Procurement methods which compares them and draws conclusion on their use in theory and practice.
Procurement was long neglected by business management and economic theory. The role of Procurement & Supply chain was always seen as a secondary activity in the organization and its supportive role to production were encouraged in classical materials management. In the recent years SCM has been re-evaluated in the value chain of whole industries and therefore reemphasized the strategic role of Procurement for the supply chain. Procurement & supply chain mamagement is divided into 5 steps or activity fields: supporting activities, sourcing, distribution, storage and disposal.
PSCM changed the methods used in each separate step. In supporting activities for example PSCM requires multi-dimensional, long-term and dynamic instruments to guide decision-making in materials management, using cross-organizational cooperation to succeed, such as advanced purchasing. In sourcing the strategic role of sourcing was reemphasized by SCM and new tools such as the use of procurement E-AUCTION methods, SCR, green sourcing, TCO, Ethical sourcing, PCB, strategic alliances and TPB were introduced, due to the new cooperative paradigm in SCM. In distribution and storage too, cooperative instruments are used to keep up competitiveness,