How do the purchasing departments and suppliers of lean management enterprises cooperate?

There is a Chinese idiom called “keep improving, keep improving management”. This not only represents an attitude, but also becomes an important mode: refined and precise management. What will SAP, the world ‘s software giant, say? “There are three ways to build a smart enterprise architecture, none of which requires an enterprise to build a lean enterprise architecture. This architecture is low-cost, data-driven, and can provide the architecture flexibility needed in a new economic era.” No matter lean enterprise structure or lean management, there is only one goal. It can reduce cost, save energy, help enterprises to operate flexibly, and constantly respond to the changing market quickly, so as to upgrade the core competitiveness of enterprises. In this case, let’s choose a sub topic to talk about: how does the purchasing department and supplier of lean management enterprise cooperate?

From the macro lean management to the relationship and cooperation between subdivided procurement and suppliers, accurate, flexible and sustainable operation becomes the key. Through the investigation of experts, we found that the cooperation between purchasing department and suppliers under lean management mainly covers five aspects: regarding suppliers as part of the value chain, suppliers must also carry out cost war, suppliers must deliver goods in time, use global purchasing leverage, and handle projects with long delivery time. Next, I will make a brief analysis.

Compared with this kind of cooperation, the relationship between traditional procurement and suppliers is more harmonious. Traditional procurement regards suppliers as enemies or rivals. Procurement management under lean management is to integrate suppliers into the community of interests in the business ecological chain, to protect each other’s interests and fight side by side.

Cost reduction is an eternal theme in the process of enterprise management, so the purchasing department needs to reach an agreement with suppliers around this goal, and at the same time help suppliers to achieve it through various ways and means, such as management, process, details, etc. Of course, the delivery time of suppliers also needs to be coordinated in time to ensure timely delivery and realize seamless docking between them.

However, more and more enterprises are looking at the global procurement mode. Although local advantageous resources can also obtain good prices, they do not hinder the optimal management objectives. In terms of procurement cost, many companies even unite with more procurement groups to strive for lower prices and maximize benefits. Finally, for projects with a long delivery period, enterprise procurement needs to be predicted in advance, and the most reasonable and flexible way should be appropriately selected to ensure the smooth delivery period, such as placing some orders in advance.

When enterprises regard continuous improvement of profitability as an important indicator, more and more enterprises seek to achieve the bottom line advantage of expenditure from purchasing to supplier management and cooperation. If we can reduce the cost of purchasing products and services, we can improve the profitability. Precise management is to achieve this goal. In this process, many enterprises use SAP system to achieve a series of perfect cooperation between purchasing department and suppliers, from supplier registration to order, design, from collaborative replenishment to supplier connection.

For a more comprehensive understanding, consult the acloudear — SAP partner.

This article "How do the purchasing departments and suppliers of lean management enterprises cooperate?" by AcloudEAR. We focus on business applications such as cloud ERP.

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