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Conclusion and Chapter Wrap-Up

The goal of this chapter is to discuss the roles and objectives of purchasing within an organization and in supply chain operations. This chapter describes purchasing’s role in the organization and the interaction with other organizational functions. There is much discussion on different ways that purchasing can add value, including involvement in new product development. The bullwhip effect is introduced to show the many ways that conflict and complexity are driven into the supply chain.

The strategic levels of the purchasing process are touched on, and are discussed in much more detail in later chapters. A number of different types of products and services that purchasing buys are noted. Key terms used throughout the rest of the book are also defined throughout this chapter.

The key points from this chapter include

  • Understanding the important role of purchasing in an organization
  • Assessing the purpose and goals of the supply management organization and its contribution to profitability and the bottom line
  • Identifying the relationship between the purchasing function and other functional areas
  • Identifying the activities that are part of supply management
  • Understanding the different categories of purchasing spend
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