PurchasingandordermanagementCustomersMaterialsflowSuppliersProcurementOperationsDistributionRequirementsinformationflowInboundlogisticsOutboundlogistics
PurchasingandordermanagementTheobjectiveofpurchasingis: tosecureoptimalsupplierperformance withrespecttooptimumquality timelydelivery minimumcosts.Purchase,procure,source,buy purchasingmanager/chiefbuyer
Situationswhichcangiverisetointer-departmentalconflicts
RelationshipswithotherfunctionsProductioncontrolPhysicaldistributionReceivingandstoresFinanceDesignengineeringIndustrialengineering
ThepurchasingprocessRecognizeaneedSelectsuppliersIssuetheorderTrackandreceivetheorder
OtherimportantissuesCentralizedanddecentralizedpurchasingDecision-makingastomakingorbuying (corecompetency)SupplierrelationshipSupplierselection
OrdermanagementOrdercycleSeller:thetimewhenanorderisreceivedfromacustomertowhenthegoodsarriveatthecustomer’sreceivingdock.Buyer:fromwhentheorderissentouttowhenthegoodsarereceived.Theshorterandmoreconsistenttheordercycleis,thelessinventoryisneededbyone’scustomers.
SalesforecastingThereisalinkbetweenordermanagementandsalesforecasting.Afirmdoesnotsimplywaitfororderstoarrive.Forecastsaremadeofsalesandinventorythatmustbestockedsothatthefirmcanfilltheordersinasatisfactorymanner.
OrdermanagementOrderplanningOrdertransmittalOrderprocessingOrderpickingandassemblyOrderdelivery
OrderplanningTheproblemofbunchinghappenswhenahighpercentageofcustomersmaketheirordersatthesametime.Ifcustomers’orderingschedulescanbeinfluenced,afirmcanbalancethemoutandminimizethepeaksandvalleysoftheworkloads.
3techniquesoforderplanningUsefield(outside)salespeoplewhotakeorderwhentheycalloncustomersUsephone(inside)salespeopleOfferasubstantialpricediscounttocustomerswhoplaceordersoncertai