Chapter 1 Answers, Monczka Et Al 2011

2. What is the difference between purchasing and supply management? What is the difference between a supply chain orientation and supply chain management?

While many practicing professionals use the terms “purchasing” and “supply management” interchangeably, Monczka et al (2011) points out the differences between the two terms. Purchasing is a functional group (i.e., formal entity on the organization chart) and a functional activity responsible for the basic day-to-day functions (i.e., buying goods and services). Supply management is purchasing on steroids and more than “ordering” parts and supplies. Supply management takes on a broader concept that focuses on the strategic approach used to plan and acquire current and future needs of an organization. Simply stated--supply management is new way of doing business by owning the “process.” It involves internal operators within an organization (i.e., purchasing, engineering, quality assurance) and external suppliers to work together as a team to achieve advances in cost management, product development, cycle times, and total quality control.

A supply chain orientation is an organization’s recognition of the broader concept of supply management and the strategic approach incorporating internal operations, suppliers, and customers into the process. Therefore an organization that only sees the strategic implications in one direction does not have a supply chain orientation. A supply chain is a set of three or more organizations linked directly by a supplier or customer. Supply Chain Management therefore endorses the implementation of a supply chain orientation across a set of three or more organizations linked directly by a supplier or customer (Monczka et al, 2011).

8. Why are supply base innovation and risk management two future areas that will consume mor of the supply manager’s day?

According to Monczka et al (2011), the Supply Manager’s role in an organization must change if that organization is looking to go...