-Identifying and selecting suppliers, negotiating contracts

-Purchasing researching

-Operational support and follow-up

-Administration and support

-generating cost-reduction

-improving supply chain quality

-access to supply and technology

-improving cycle time

-streamlining business processes

Right Supplier

Right Specification

Right Quantity

Right Time

Right Location

Right Price

Uninterrupted flow of high-quality material, supplies and services.

If any of these DO NOT occur, then it is NOT a perfect order. 

A business process is a collection of structured, related activities that produce a specific service or product or serve a particular goal for a customer. A process can be visualized with a flowchart as a sequence of activities. 

Done repeatedly. A process is NOT a project. 

P2P Objective: achieve the 'best landed cost' position for a specified product quality, quantity and terms and conditions. 

Key Steps: Select, Requisition, Process, Pay

**One of the most FERTILE areas for cost reduction. 

Comparing myself to the standard; constant evaluation against peers, world class and best of class. 

Purpose: provides clear understanding of best practices, helps identify what other organizations are doing, helps improve productivity and competitiveness, utilizes resources. 

Focues on "doing things right"; a process of constantly looking at results and searcing for areas of improvement. 

Attempts to reduce variation and waste in processes to achieve the desired outcome with better utilization. 

Works by -defining strategic goals -determining customers

-aligning business processes to realize goals

The OBJECTIVE of BPI is breakthrough change in the performance of an organization or business process rather than a series of incremental changes. 

Policies are established purposes, principles and rules of action that guide an organization. 

Advantages: management defines objectives and communicates them; provides a consistent framework; details executive and functional management expectations.

Disadvantages: policies are difficult to communicate; strict adherence to policies can be unfavorable; restricts innovation and flexibility. 

A set of moral principles or values that guide one's behaviors. 

-Be loyal to the organization

-Act ethically toward the supplier

-Uphold ethical standards of the profession

-Wrongful use of info; exaggerating problems; requesting bids from unqualified suppliers; unfair information; not compensating designers; lying. 

Reciprocity: giving preferential treatment to suppliers who are also customers; FTC rules

Personal Buying: buying materials to satisfy the personal needs of employees. 

Procedures are operating instructions on how to functionally carry out a task. 

Benefits: offer a tool for consistency of action; provides a means of training employees; allows for documenting 'industry-best' practices.