Questions for Review
Questions for Review
Differences between Needs Identification and Defining Commercial Equivalents
Need identification refers to the third stage in a personal promotion process that involves seven stages. This stage involves a question and answer cycle with an aim to identify requirements of a vision. The salesperson assists a buyer to spot and measure a niche between the current business position and the future desired position. Requirements are derived and solutions determined from the identified and measured niche. Commercial equivalents refer to the proposal period that unveils representations required during program implementation. It is advisable to separate the two processes, as the company needs to understand what is needs and why it needs. Once a necessity is recognized, it can be transformed into an equivalent for the supplier. Separating the two processes helps a company to acquire a supplier with a lower cost and a superior product quality. Failure of separating the two processes results in the overlooking of market opportunities.
Early Supplier Involvement Value to an Organization
Early Supplier Involvement (ESI) is a process of direct interaction between a manufacturer and a chain of suppliers. The manufacturer integrates the supplier in the product development process in the early stages of production (Leenders, Johnson & Flynn, 2011). Integration of the supplier results in full expertise in the latest materials to maximize product quality, production solutions and market acceptability. Products that are not market feasible are eliminated from the production line even before prototyping. Suppliers also increase the capability to identify production errors and potential risks early in the production process. This saves o the production cost and time. Supplier involvement also reduces the production time and production cost through derivation of best production algorithms enabling a product to reach the market faster. These merits in production increase revenue generation and customer satisfaction in the timely delivery of quality products.
Advantages and Disadvantages of Specifying by Performance
Performance specification (PS) refers to attainment of a given goal under the boundaries of measurements such as accuracy, cost and completeness (Benton, 2007). The advantages of specifying by performance mostly rest on the labor force in production. The process allows staff to grow and develop in skills and structure. PS allows an employee to reach his/her full potential which is mutually beneficial to the employee and the employer. Companies that use PS are able to identify and eliminate under performers. Staff motivation, staff rewards and staff development all are merits of PS. The disadvantages of performance specification is that the process is time consuming, discouraging to under performing employees, humanly bias and inconsistent with managerial changes. Managers take a lot of time in measuring employee performance wasting quality time that could be applied somewhere else in production. Weak employees are constantly threatened with employment termination killing the spirit to improve. Managerial changes affect the PS process, as new managers have to start afresh evaluating the employees.
Strategic requirements as Understood by Supply Professionals
requirement refers to the process of planning the requirements needed in the
production process. The requirements that are identified are analyzed and
categorized into long term or short term. Strategic requirements to a supplier
aim at the supply of a product that will remain marketable for a long period (Leenders,
2006). Companies that take a short-term view in product delivery end up with a
loss of market opportunities. In the strategy, the market, competition, labor
market, economy and technology are all analyzed to support long-term delivery of
products. The process assists in the identification of weaknesses and strengths
thus optimizing in the best way forward in the production.
Leenders, M. R. (2006). Purchasing and supply management: With 50 supply chain cases. New York, N.Y: McGraw-Hill.
Johnson, P. F., Leenders, M. R., & Flynn, A. E. (2011). Purchasing and supply management. New York: McGraw-Hill/Irwin.
Benton, W. C. (2007). Purchasing and supply management. Boston: McGraw-Hill Irwin.