Procurement and Inventory Management

Expected to answer any 2 of following 5 questions*

Questions
1.    Procurement Process
Part A-20 marks
Develop a structure for the sourcing process that CCC could implement to support a new company wide procurement strategy. Identify which processes are especially relevant for the diversity of the 3 main product groups;
•    Concrete.

•    Steel.
•    Glass.
Part B-20 marks
Discuss how the structure and strategy described above will support such important issues as; supplier selection, volume forecasting, transportation, etc.
Discuss and give examples of which element of the proposed procurement sourcing process initiative would be most relevant for each product group.
2.    Supplier Relationship
As each “project” requires a wide range of local services to complete the work, to the satisfaction of the customers, they will no doubt face many different problems with supplier’s products due to the issues from the case study. Discuss what these problems may be and identify how CCC may be able engage and work with global suppliers to leverage volume purchasing and control distribution to reduce the overall spend on each product group identified in Question 1.  Discuss how the relationship between local and global suppliers and CCC will change under this scenario (i.e.
CCC working with global suppliers) – 30 marks
You should Illustrate best practices e.g. From construction companies you find in your research- 10 marks

3. Inventory Management Techniques and Improvements

Appraise the merits, validity and risks associated with the following techniques with respect to the challenges facing CCC in managing the flow to construction sites (point of usage) of the three product types; Concrete, Steel and Glass identified in Question 1.
•    ABC Analysis-8 marks
•    Supply scheduling-8 marks
•    Dependent demand-8 marks
•    Bulk orders 8 marks
•    Vendor Managed Inventory 8 marks

4.
Ethical Practices
40 Marks
Consider the ethical and environmental issues, specifically relating to procurement, that may affect a business like CCC with special consideration for the production, handling, transportation and disposal of the three product types; Concrete, Steel and Glass identified in Question 1. Consider any issues with the distribution and storage of these product types that affect this type of industry.
You should support your response with relevant examples from construction or other industries or your own experiences.


5. Contract Considerations
Part A-25 marks
While the new sourcing and procurement processes are been developed, CCC must also in parallel consider the impact on any existing contracts in place with suppliers who may be able to provide a more global service. They need to develop/modify existing or create suitable contracts that will support the new procurement strategy.
Part B-15 marks
Discuss how CCC may do this. You need to explain the potential impact this will have on current projects with a focus on the management and lifecycle of the new and existing contracts.