Procurement and contract management Coursework Example | Topics and Well Written Essays - 1500 words

Procurement and contract management - Coursework ExampleThe present paper looks into the supplier relationship of BCAM which is being managed by Irwin family dealing in agricultural components. The paper will further study the outsourcing options available to the company, suggest a methodology and outline certain difficulties that the company may experience in global outsourcing. a) BCAM Supplier Relation and Its Consequences Supplier sufferment is a process where on partner in a relationship modifies or otherwise influences the behavior of the other partner with a view to mutual benefit (Crocker, 2009). British Consolidated Agricultural Machinery (BCAM) was established by Harry Irwins father hundred years ago during the period of mass industrialization manufacturing tractors and other agricultural machinery such as harvesters, balers, movers, seed drills, and sprayers. While reviewing the purchasing mathematical operation at BCAM, it is revealed that orders are placed in bulk ev en though if the materials are not required for the purpose of production so as to rescind logistical time and costs. BCAM supplier development strategy was weak considering the fact they placed their orders with the suppliers who were associated with the company for many years. According to Crocker (2009) supplier development is necessary to develop the supply base in areas of recognized weakness, develop a long term relationship with few reliable suppliers, reduce the risk by communion information, enhance the benefits of mutual goals and synchronize the overall process of supply chain process. This shows that the companys transactions were limited to few suppliers and the relationship between some(prenominal) is adversarial as BCAM doesnt pay them as agreed during the contract. Saunders et al (Swamidass 2000) mentioned that adversarial relationship is promoted when they operate at arms length with communication without personal arrive at and gains by one partner are seen as b eing at the expense of other contributing to apparent lack of trust and not industrious to share information. According to Handfield and Bechtel (2002, reliance on trust at the interpersonal level may be conditioned by legal systems or organizational role responsibilities, mitigating the ability of parties to rely on trust as a matter of first preference. The relationship between BCAM and its suppliers exceeds their contract and operates beyond it resulting in breach of supply chain management. The company had to face the consequences of such relationship as their orders placed by BCAM would not be taken as top precedency leading to purchase departments failure to provide required material for production resulting in delayed customer delivery. The fact that both maintained cordial relationships and sanction on the suppliers side that they would definitely receive their payment made it possible to continue the transaction. Moreover, in such type of relationships, complaints are not addressed imputable to the negligence from buyers side as evidence in BCAM Company wherein complaints by purchasing department were snubbed by suppliers owing to late payments. b) Buyer Supplier consanguinity Approach Organizations are more actively involving suppliers in their integrated development process and identify suppliers as a source of competitive advantage which nub that there is an opportunity to develop and identify the factors that could help sustain or improve the relationship between the buyer and the supplier (Nellore, 2001). Developing partnerships with suppliers is