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Every Organisation has their own techniques to keep their management department smooth and efficient.
Every Organisations are part of procurement process in different ways. Some organisations have continue requirements which makes large part of their daily operations, while other Organisation only need to procure specific goods on a periodic basis.
Whenever projects are carried out the need of procurement management and supply chain management is very important portion of overall process.
When particular project is rolled out and management at initial doesn’t plan or forgets in some cases of procurement schedule, it will be a biggest & costliest mistake to the Organisation, as because the entire production come to a stop if products and materials aren’t available when needed.
I will mention a example to clearly understand on above statement: A construction company have taken government highway contract to build the roads & started executing the task.
On 40% completion of project, project manager comes to know the required cement bags are ordered in less quantity which needed to be more in stock the production comes to an halt as due to next order are in bulk and transportation requires time.
So everything comes to a halt due to this minor mismanagement. It can lead to cancellation of contract.
To identify what all material & stuff is needed and what not is a first decisive step towards getting procurement management correctly.
Companies generally use bidding process to make sure a fair price is obtained. Once the company is sure about what they need exactly then company bid out the orders to different different suppliers and get out with the reliable prices.
In this process decision makers should be very confident about selecting a supplier as he need to ensure that vendor will be able supply the demand in required time. Otherwise many suppliers quotes low prices to gain the contract and later is unable to fulfill the demands due to low pricing. This becomes a huge mess, as it is effected from labor to top management.
Supplier are not only a part who will supply you products, you are bringing them into your process in a way.
Contracts are bound to be made if your company is working with external organizers or product suppliers. It should state their roles and responsibilities and prices they have agreed to supply the raw materials or goods.
References, colleagues, Friends whoever might be your supplier if Organisation sticks to the process by signing contract, everything documented there would be no risk zone for your Organisation. This will maintain an healthy relation to work further.
All the above measures is very complicated to handle it manually. Time is main constraint to meet the project timeline.
So by implementing procurement management software all the departments comes to one place starting from Material Request, Purchase request, Vendor inquiry & Quotation, Vendor Po's to Production Order. Different types of inventory transactions to track material movement across inventory can be created.
One more added advantage of implementing Procurement software is everybody whole relates to this project are aware what is going in real time by one click access to it including top management and stakeholders from any part of their location due to cloud base.
Decision makers can plan the funds according to priority need or divide by having current project scenario in front of them. Total crystal clear transparency is accumulated.
If you do have any doubts comment below in comment section.
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