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1、AbstracctIndustrrial MMarketting MManageement 32 (22003) 365 374Strateggic coost maanagemment aacrosss bounndariees of firmssAnna Duubois*Departmment oof Inddustriial Maarketiing, CChalmeers Unniverssity oof Tecchnoloogy, GGothennburg S-4122 96, SwedeenIn receent yeears, increeasingg atteentionn has
2、 been placeed on how ppurchaasing strattegiess may contrributee to tthe effficieency oof firrms. IIn thiis papper, aacase sttudy iillusttratess how one ffirm iimplemmentedd a suupplieer basse redductioon to enablle a hhigh iinvolvvementt straategy in reelatioon to appoiinted keysupplieers. TThe efff
3、ectss of tthis cchangee in ppurchaasing strattegy wwere eextenssive ccost rrationnalisaationss. Thee mainn channge inn thiss proccess wwas aredefinnitionn of tthe unnit off anallysis from indivviduall trannsactiions tto buyyer suppllier rrelatiionshiips. HHoweveer, thhe cossts inn the relattionshhip
4、 arredriven not oonly bby intternall facttors oon thee two sidess of tthe reelatioonshipp but also by hoow thee focaal rellationnship relattes too otheer rellationnshipss.Therefoore, tthe waays inn whicch thee costts aree affeected by otther ppartiees, suuch ass the suppllierss suppplier, the suppll
5、ierss otheer cusstomerrs, thhecustomeers oother supplliers, and the ccustommers custoomers, needd to bbe inccludedd in tthe annalysiis.D 2003 Elsevvier SSciencce Incc. Alll righhts reeserveed.Keywordds: Puurchassing; MRO; Totall costt1. IntrroducttionThe suppply sside oof commpaniees hass becoome in
6、ncreassinglyyimportaant ovver thhe lasst feww decaades. One rreasonn is tthat tthecosts oof purrchaseed gooods annd serrvicess reprresentt the majorrityof totaal cossts foor mosst commpaniees. Thhis hiigh shhare iisattribuutablee to tthe ammbitioon of compaanies to cooncenttratemore off theiir efffo
7、rts on a limitted paart off the totall actiivitystructuure off the businness nnetworrks inn whicch theey areeinvolveed. Byy outssourciing acctivitties tto suppplierrs, fiirms aareable too speccialisse theeir owwn opeeratioons.It is nnot onnly thhe inccreasiing fiinanciial immpact that makessthe supp
8、ply sside ssignifficantt. Anoother more imporrtant reasoon isthe chaangingg natuure off the conteent off buyeer ssuppliierexchangge. Ovver tiime, ooutsouurcingg of mmanufaacturiing acctiv-ities hhas beeen foolloweed by outsoourcinng of desiggn andddeveloppment work. To aan inccreasiing exxtent, supp
9、plierss arecontribbutingg to tthe teechniccal deeveloppment of a compaany.This chhange has bbeen aaccenttuatedd becaause oof inccreasees in thenumber of diiffereent teechnollogiess a coompanyy now needss inorder tto be able to opperatee and becauuse off the higheer cosst ofdevelopping eeach ssubseqq
10、uent generrationn of ttechnoology. Com-panies todayy are depenndent on knnowleddge deevelopped anndsupplieed by otherr firmms.* Tel.: +46-31-7772-11996; faax: +446-31-772-33783.E-mail addreess: aanndubbmot.chalmmers.sse (A. Duboois).A thirdd reasson foor whiich thhe suppply sside hhas coome mooreint
11、o foocus iis thee enhaanced signiificannce off inteerfacees witthother ffirms HYPERLINK #10 (Arauujo, DDuboiss, & GGadde, 19999) HYPERLINK #10 . Inteerfaceeswith suupplieers arre cruucial not oonly wwhen iit commes too techhnicalldeveloppment, but managgementt conccepts and ttechniiques suchas justt
12、-in-ttime (JIT), totaal quaality managgementt (TQMM), anndzero-defecct priinciplle aalso hhave ssubstaantiall impaacts oon theeway firrms opperatee. Appplyingg thesse tecchniquues reequirees theeactive invollvemennt of supplliers and aaffectts thee costts anddbenefitts of both buyerr and suppllier.T
13、he enhhancedd signnificaance oof thee suppply siide haas maddepurchassing aa straategicc funcction. The contrributiions ffrompurchassing tto thee straategicc deveelopmeent off a coompanyy maybe summmariseed in two sstrateegic rroles: ratiionaliisatioon andddeveloppment HYPERLINK #10 (Axellsson & Hak
14、anssson, 11984) HYPERLINK #10 . The devell-opment role conceerns tthe puurchassing ffunctiions contrributiionto the technnical devellopmennt of the ffirm tthrouggh orgganisiingand mannagingg relaationsships with supplliers. As rregardds theerationaalisattion rrole, HYPERLINK #10 Gaddee and Hakaansso
15、nn (20001)distiin-guish tthree main typess of rroles. The firstt is rrelateed todiscoveering what needss to bbe purrchaseed. Thhe seccond iisrelatedd to rrationnalisaation of loogistiics acctivitties aand thhe thiirdto ratiionaliisatioon of adminnistraative routiines.To enabble thhe purrchasiing fuu
16、nctioon to contrributee to ttheseroles, purchhasingg straategiees aree needded. AAccordding tto HYPERLINK #10 Gadddeand Hakanssson (22001), threee strrategiic isssues nneed tto beconsideered: (1) mmake oor buyy deciisionss, (2) suppply baasestructuure, aand (33) natture oof cusstomerr suupplieer rel
17、lationnshipss.0019-85501/033/$ see ffront matteer D 22003 EElseviier Scciencee Inc. All rightts resservedd.doi:10.1016/S00199-85011(03)000010-5366A. Duboois / Indusstriall Markketingg Manaagemennt 32 (20033) 3655374In thiss papeer, wee conccentraate onn the ratioonalissationn rolee andhow it affecct
18、s annd is affeccted bby thee suppply baase sttructuure anndthe natture oof buyyer suppllier rrelatiionshiips.The aimm of tthe paaper iis thuus to discuuss hoow thee purcchasinngstrateggy mayy conttributte to the rrationnalisaation role of puur-chasingg. In partiicularr, it focusses onn how changges
19、toowardsshigher levells of invollvemennt in buyerr suupplieer rellationn-ships, in paaralleel to efforrts too reduuce thhe nummber oof suppplierrs,may imppact oon thee suppplierss abiility to coontribbute tto cosstrationaalisattions.The firrst paart off the paperr focuuses oon purrchasiing sttrategg
20、iesand howw theyy are assummed too conttributte to the eefficiiency ofthe firrm. Thhereaffter, cost ratioonalissationn throough ssuppliierrelatioonshipps is discuussed and MMainteenancee Repaair anndOperatiions (MRO) suppllies aare inntroduuced aas a pparticcularllycompliccated purchhasingg areaa wh
21、erre theere arre typpicallly larrgerationaalisattion ppotenttials. A caase deealingg withh MRO pur-chasingg is ppresennted iin Secction 3 andd anallysed in Seectionn 4.Thereaffter, the cconcluuding discuussionn focuuses oon howw andwhy strrategiies foocusedd on hhigh iinvolvvementt withh fewsuppliee
22、rs caan andd shouuld bee succcessfuully ppursueed. Fiinallyy,some maanagerrial iimpliccationns aree addrressedd focuusing on thhetotall costt conccept and the pprobleems annd pottentiaals off itsapplicaation.2. Purcchasinng strrategiiesThere aare diiffereent diimensiions iin whiich puurchassingstrat
23、eggies aare deescribbed. TThere are aalso ddifferrent ssuggesstionssas whenn to aapply diffeerent strattegiess, i.ee., hoow to distiinguisshamong ssituattions wheree theyy can contrributee to tthe effficieencyof the firm. We ffocus on twwo succh dimmensioons: tthe deegree ofinvolveement in inndividd
24、ual ssuppliier reelatioonshipps andd thenumber of suupplieers HYPERLINK #10 (Gaddde & HHakannsson, 20011; Gaddde& Snehoota, 22000). Gaddde andd Snehhota pproposse invvolvemmentas a coonceptt to ddescriibe thhe exttent oof inttegrattion iin rellationn-ships. As suuch, iit is usefuul to distiinguissh
25、thrree diimensiions oofinvolveement that affecct outtcomess in ssuppliier reelatioonshipps:coordinnationn of aactiviities, adapptatioons off resoourcess, anddinteracction amongg indiividuaals.Recommeendatiions ffor appplyinng a sstrateegy baased oon lowwinvolveement with supplliers are bbased on thh
26、e asssumptiion thhatinternaal or indirrect ppurchaasing costss can be keept loow wheenthere aare liimitedd coorrdinattion, adapttationn, andd inteeractiionwith inndividdual ssuppliiers. Furthhermorre, thhe priice, oor theedirect purchhasingg costt, is assummed too be llow whhen seeverallsupplieers a
27、rre plaayed ooff aggainstt one anothher HYPERLINK #10 (Gaddde &Hakanssson, 2001).Strateggies bbased on hiigh innvolveement, on tthe otther hhand,are asssumed to reesult in cost beneffits iin terrms off reduucedcosts iin prooductiion prrocessses annd matteriall flowws as well asimproveed serrvice lev
28、ells andd flexxibiliity. FFurtheermoree, it ispossiblle forr the custoomer tto takke advvantagge of suppllier sskillssand cappabiliities to immprovee the qualiity off its own pproducctsand serrvicess, whiich, iin turrn, haas revvenue beneffits HYPERLINK #10 (Gaddde &Hakanssson, 2001, p. 1139). These
29、e gainns, hooweverr, cannnot bbeattaineed witthout substtantiaal cooordinaation, adapptatioon, annd in-teractiion, eentailling ccosts. Hencce, puurchassing sstrateegies baseddon low and hhigh iinvolvvementt, resspectiively, are assummed toocontribbute iin diffferennt wayys to the eefficiiency of thh
30、e buyyingfirm.Most cuurrentt purcchasinng mannagemeent liiteratture ssuggessts amixturee of llow annd higgh invvolvemment sstrateegies in reelatioon tosupplieers. VVariouus purrchasiing poortfollio moodels (e.g., HYPERLINK #10 Benn-saou, 11999; Kraljjic, 11983; Olsenn & Elllram, 19977) sugggestdiffe
31、reentiatted puurchassing bbehaviiour ffor diiffereent caategorriesof prodducts and ppurchaasing situaationss. Loww invoolvemeent, oorarms-llengthh relaationsships, is ssuggessted wwhen tthe fiirmspower oor barrgainiing poositioon perrmits them to usse a ppricepressurre strrategyy, whiile hiigh innvo
32、lveement, and thus somesort off paartnerrship, iss sugggestedd whenn inteerdepeendencce onindividdual ssuppliiers ccannott be aavoideed HYPERLINK #10 (Duubois & Peddersenn,2002). Theree are typiccally two ddimenssions that deterrmine thechoice of sttrateggy forr eachh prodduct oor purrchasiing siitu
33、atiion:(1) tthe immportaance oof purrchasiing and (2) the ccompleexityof the supplly marrket HYPERLINK #10 (Kraaljic, 19833) HYPERLINK #10 .If the buyerr cannnot avvoid ddependdence on a partiicularrsupplieer, thhe porrtfoliio moddels ttypicaally aadvisee parttnershhip,where tthe buuyer aand suuppli
34、eer beccome mmutuallly deependeent.Hence, high invollvemennt rellationnshipss or parttnershhipswith suupplieers arre sugggesteed as meanss of ddealinng witth acomplexx purcchasinng sittuatioon. Hooweverr, as it enntailss reciip-rocal ddependdence betweeen thhe buyyer annd thee suppplier,partnnershii
35、ps are mmainlyy seenn as pprobleematicc and thussituatiions tthat sshouldd be aavoideed if possiible.The nummber oof suppplierrs is of immportaance iin botthpurchassing sstrateegies but ffor diiffereent reeasonss and in diiffer-ent wayys. Hiigh innvolveement is coommonlly asssociatted wiith asingle
36、sourccing ppolicyy and low iinvolvvementt withh duall ormultiplle souurcingg HYPERLINK #10 (Gaddde & Snehoota, 22000) HYPERLINK #10 . Whenn purssuinga strattegy bbased on loow invvolvemment, a nummber oof commpet-ing suppplierrs is necesssary in orrder tto achhieve the llowesttpossiblle priice foor
37、eacch purrchasee. Howwever, sincce theere arrecosts aassociiated with plaaying the mmarkett HYPERLINK #10 (HHahn, Kim, &Kim, 19986), the nnumberr of ssuppliiers uused, or teenderssrequireed, haas to be baalanceed agaainst the ppotenttial ggains inobtainiing a low pprice.When a high invollvemennt str
38、rategyy is ppursueed, thhe nummberof suppplierss is oof impportannce siimply becauuse itt is nnot poossibllefor a ffirm tto coooperatte cloosely with too mmany ssuppliiers.Therefoore, ssinglee sourrcing is offten ssuggessted aas a mmeans ofreducinng thee suppplier base and ttherebby of enablling ccl
39、oserrcooperaation with the rremainning ssuppliiers HYPERLINK #10 (Gaddee & Haakanss-son, 20001). Howevver, ffor moost maanufaccturinng firrms, tthevarietyy in ttheir purchhasingg needds impplies that the ttotalnumber of suupplieers woould rremainn largge eveen if they con-centratted onn one suppllie
40、r pper prroductt. In this respeect, iit is notalways obvioous exxactlyywhatis too be ppurchaased. This isparticuularlyy probblemattic beecausee mostt exissting modells ofpurchassing aare baased oon speecifieed purrchasiing neeeds, whichhare thuus connsiderred too be giveens.A. Duboois / Indusstriall
41、 Markketingg Manaagemennt 32 (20033) 36553743673. Costt ratiionaliisatioon thrrough suppllier rrelatiionshiipsFor mosst commpaniees, thhe cossts off purcchasedd goodds anddservicees havve comme to accouunt foor thee majoority of tootal ccosts.The priimary driviing foorce oof thiis devvelopmment iis
42、thee incrreas-ing relliancee on ooutsouurcingg, makking eefficiient ppurchaasingactivitties ccruciaal to the ffinanccial pperforrmancee of ccompannies.Therefoore, HYPERLINK #10 Monczzka annd Morrgan (2000)arguee thatt therremust bee an absoolute linkaage off sourrcing, purcchasinng, annd theesupply
43、chainnto tthe fiinanciial pllan and tthus tto thee finaancialloutcomee of tthe opperatiions oof thee firmm. Thee authhors cconcluudethat inncreassing aattenttion tto cosst mannagemeent iss the mostimportaant faactor for tthe fuuture of puurchassing aand suupplymanagemment. They also referr to nnumer
44、oous exxamplees wheerecompaniies haave beeen abble too reduuce puurchassing ccosts. In mmostcases, thesee effoorts hhave cconcerrned ddirectt purcchasinng cossts,such ass pricce, trranspoortatiion coosts, etc. Howevver, ssometiimes,the inddirectt costts asssociatted wiith puurchassing (e.g., costts
45、ofwarehouusing, admiinistrrationn of ppaper work, and suppllierhandlinng cossts) rrepressent ggreateer pottentiaal forr ratiionaliisatioon.The prooblem is thhat thhese ccosts are mmore ddifficcult tto afffectbecausee mostt of tthem ccan bee tackkled oonly tthrouggh joiinteffortss withh suppplierss.
46、Connsequeently, thesse cossts arre ofttenneglectted, aand HYPERLINK #10 Moonczkaa and Morgaan (20000 HYPERLINK #10 , p. 555) cooncludde:And rregarddless of alll tallk aboout sttrateggic coost maanage-ment, mmost ccompannies aare onnly att the tip oof thee icebberg iinterms oof acttual ppractiicesiin
47、 terrms off lookking aat wheerecosts rresidee, loooking at coost drriverss, buiildingg crosss-enterprrise sstrateegies and sshare the rresultts. Alll of theseepracticces arre goiing too needd to bbe reffined. Crosss-entterpriisecost iss, andd willl incrreasinngly bbe, crriticaal to a firrms ssuccess
48、s.It has been argueed thaat purrchasiing off MRO itemss is oone offthe areeas whhere aactionns to reducce cossts accross firm boundd-aries aare moost evvidentt (seee, forr exammple, HYPERLINK #10 Averyy, 19997;Bechtell & Paattersson, 11997; Le Suueur & Dalee, 19998). AAnumber of coompaniies reeport
49、consiiderabble acctivitties iin makk-ing theeir MRRO purrchasees morre effficiennt (seee, foor exaample, HYPERLINK #10 Purchassing, 2001aa,b,c and dd HYPERLINK #10 ). Onee exammple oof whaat seeem tobe a coommon tendeency iis MROO purcchasinng at Boeinng, whhereit iss moviing frrom a nonsttrateggic,
50、 aad hocc, deccentraaliseddpurchassing aactiviity too a moore sttrateggic annd virrtuallly cenntral-ised puurchassing ppractiice HYPERLINK #10 (Purcchasinng, 20001d) HYPERLINK #10 .Accordiing too HYPERLINK #10 Bechhtel aand Paattersson (11997) HYPERLINK #10 , purcchasess ofMRO iteems weere prreviouu
51、sly bbased stricctly oon obttaininng theebest prrice. Hencee, buyying ffirms triedd to llower purchhasinggcosts bby foccusingg on ddirectt costts forr indiividuaal traansacttions.When itt becaame cllear tthat ssubstaantiall indiirect costss accoom-pany thhis puurchassing oorienttationn, firrms beega
52、n tto makkeinternaal rattionallisatiions oof theese puurchasses. IIn parrticullar,the hugge amoount oof papperworrk gennerateed apppears to haavebeen coonsideered aa probblem. By inntroduucing blankket orrdersand sysstem ccontraactingg the paperr floww coulld be reduccedconsideerablyy. In this way,
53、the bbuyingg firmms madde it possiibleto reduuce thhe timme speent onn thesse purrchasees HYPERLINK #10 (Bechhtel &Pattersson, 11997). A fuurtherr imprrovemeent off inteernal pur-chasingg routtines was mmade wwhen ppurchaasing cardss wereeintroduuced. Usingg thesse carrds meeant ssignifficantt admii
54、nistrrat-ive proocessiing saavingss, sinnce puurchassing rrequissitionns anddpurchasse ordders ccould be elliminaated.Howeverr, intternall effoorts tto redduce ccost wwhile mainttaininnga largee numbber off suppplierss can only take the ffirm tto a ccertaiinpoint aafter whichh therre aree no aadditi
55、ional cost ratioonalissationnsto be oobtainned inn-housse. Thherefoore, ccompannies sseem tto beabandonning tthis pphilossophy, favoouringg conssolidaation tofewer ssuppliiers HYPERLINK #10 (Gaddde & HHakannsson, 20011) HYPERLINK #10 . Therre areeseverall exammples reporrted wwhere suppllier bbase r
56、reducttionsand cenntraliisatioon of the ppurchaasing functtion hhave ggone hhandin handd. Forr exammple, beforre 19997, eaach off Whirrlpoollsmanufaccturinng divvisionns purrchaseed thee MRO itemss theyyused. WWhile theree was commoonalitty botth amoong ittemspurchassed byy diffferentt diviisionss a
57、nd the ssuppliiers tthey wwereusing, theree was no ceentrall funcction to leeveragge buyying. In1997, WWhirlppool ccreateed a ccentraalisedd purcchasinng orgganisaa-tion foor MROO and otherr indiirect materrials. Folllowingg thissreorgannisatiion, WWhirlppool hhas coonsoliidatedd its spendding wwith
58、nationaal andd regiional supplliers. The new ppurchaasing organn-isationn has proveen to be abble too put good effecctive agreee-ments iin plaace wiith suupplieers. AAccordding tto thee purcchasinngdirectoor, relattionshhips wwith tthe riight ssuppliiers ccan heelpWhirlpoool miinimisse itss riskk, b
59、e compeetitivve, annd sett newexpectaationss for perfoormancce HYPERLINK #10 (Purcchasinng, 20002b) HYPERLINK #10 . SonyyElectroonics in Piittsbuurgh aalso rreportts savvings from MROpurchassing rrationnalisaation progrrams. The mmain aactiviities inthe Sonny proogram conceern ceentrallisatiion annd
60、 connsoliddationnto feweer suppplierrs. Thhe bennefitss of tthe prrogramm are conceernedwith leeveragging oof buyying aas welll as with devellopinggcommon standdards and sservicce reqquiremments HYPERLINK #10 (Purcchasinng,2002a). Furtthermoore, JJohn DDeere now aappliees a fformallisedstrateggic so
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