Supply Management

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Category: Business and Industry

Date Submitted: 11/14/2013 01:07 AM

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1.discuss the terms

Strategy: Strategy is a high-level plan or method to achieve goals and make the vision come true for an organization. The important meaning a strategy is to comprehend fully with the vision and mission of a company and then have the right direction and do effective action. Such as over a period of time, particularly, the strategy should match firm’s resources to the future changing environment and to meet its customers’ expectation. In supply management, to do good strategic design can make increasing initial competitive for an organization and ultimately bring the profit. The strategic triangle in supply management shows that the company should make the useful strategy to its suppliers for sourcing, to its customers for marketing, also to its competitors for the competitive benchmarking.

Outsourcing: A practice used by many companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally. It would be an effective cost-saving strategy when used properly. It is sometimes more affordable to purchase a good from companies with comparative advantages than it is to produce the good internally. An example of a manufacturing company outsourcing would be Dell buying some of its computer components from another manufacturer in order to save on production costs. When companies decide to outsource, they should ensure that the outsourcing fits in with its strategy and then define carefully strategy and long-term targets for outsourcing. The communication skills and negotiation approach should be taken seriously for companies, and the services, service levels, critical needs should be considered as well during the process of outsourcing. Moreover, Offshoring is for global organizations that choosing the suppliers overseas where cost much lower than domestic.

Relationship development: For long-term plan, the close relationship with suppliers, buyers or even customers will create the biggest...