1 Chapter 21 Purchasing Changes and Trends IDIS 424 Spring 2004

2 Changes and Trends—2000s Continued Increase in long-term contracting Continued growth in worldwide sourcing Continued increase in purchase volume accumulation Expect to focus extensively on time as a competitive weapon, particularly during new product/process/service development

3 Changes and Trends—2000s A gradual decrease in the number of purchasing groups organized by commodity will continue to occur while the number of groups organized by finished product or a hybrid structure will increase Companies will continue to develop formalized systems for measuring supplier performance Executive perception of purchasing and supplier importance will continue to increase

4 Changes and Trends -2000s Continued supply base reduction Continued increase in the measurement of purchasing/supply management’s contribution and performance Firms will continue to outsource activities or purchase requirements that are not part of their core competency Expect greater reliance on full service suppliers, including full service logistical suppliers

5 Supply Chain Changes and Trends -2000s Expect the development of collaborative relationships with select suppliers Expect a growing separation between tactical and strategic purchasing responsibilities