Procurement and Supply Chain Management

PROCUREMENT AND SUPPLY CHAIN MANAGEMENT
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Procurement and Supply Chain Management
It is the acquisition of goods and services from external sources for the benefit of the company. It is quite similar to outsourcing, which entails hiring third-party professionals or companies to perform and provide services in a company. However, the two are; procurement refers to getting materials, while sourcing is the process of vetting or seeking suppliers of the materials for the service. Recently, many companies have adored procurement sectors which can either be centralized or decentralized. In a centralized setup, the decision-making role is on the senior leader, while in a decentralized model, the decision is based on the opinions of all members. The procurement department is said to be very corrupt in issuing tenders. Based on findings, to ensure transparency, an upstream or downstream process can be used. Processes that occur between sourcing and awarding the contract are upstream, while those that occur after are downstream. The upstream processes include requesting proposals, holding auctions for price negotiations between qualified bidders inclusive of the terms and conditions, and analyzing the spending rates among vendors.
On the other hand, supply chain management handles the flow of goods and services from the manufacturers to the consumers. Supply chain management help in maintaining a flow of goods and services (Lysons & Farrington, 2016). The process involves planning between manufacturing or buying goods, sourcing that involves building a relationship with suppliers, managing customer demands, storing and providing goods return services (Cox, 2001). This paper will discuss the causes and impact of the seismic shift in procurement and supply chain objectives caused by procurement with Purpose, collaborative procurement, social value creation through procurement, and the UK public procurement green paper.
Procurement with Purpose
Procurement with Purpose refers to organizations supporting the livelihood as they reach their goals and objectives. It aims at creating livelihood and employment for society by building the economies of families and societies. Procurement with Purpose can be satisfied by ensuring a business meets the community's societal, economic, and environmental needs (Dimitri, Piga, & Spagnolo, 2006). Societal needs are met by meeting and knowing the working conditions and providing jobs for suppliers; economic needs are met by helping the community grow simultaneously. Environmental needs are met through the protection of the environment and carefully using the limited resources. The organization can also support the strategy through carbon reduction, supporting diversity, environmental maintenance, and encouraging local enterprises (Bilgen, Kaygusuz, & Sari, 2004). Unilever is one of the companies striving to meet the procurement for Purpose. Based on findings, unlike most companies producing cleaning products, Unilever does not use fossil fuels (Clay, 2005). The company decided to utilize the plants, plastic waste, and carbon diox...