Management Business & Marketing Essay Research Paper (Essay Sample)

PURCHASING AND SUPPLY CHAIN MANAGEMENT
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Introduction
The world is experiencing an endless series of changes over time. The modern era invents new ideas each day. The theory and concept of business management have witnessed several transformations and development for the past few decades. Undoubtedly, procurement and supply chain management (P&SCM) are some of the business management aspects that have emerged and developed in all public and private organizations across the globe. The aim of this report is to analyse the role of procurement in SCM and the evolvement of procurement. The report also examines the appropriate means of integrating the procurement functions into the organizations’ SCM.
The Strategic Role of Procurement Function in the Context of SCM.
Defining Procurement, Supply Chain, and SCM
Procurement plays a vital role in the context of SCM. The word purchase means buying of products and services either for monetary value or an equal payment (Münch 2015, p. 42). Usually, procurement highlights operation-related activities. Therefore, the concepts of procurement and purchasing are usually used synonymously. For Münch (2015 P. 42), the provision of services, rights, goods, energy, information or the combination of these activities implies the act of purchasing. Procurement entails a broad range of contract activities including the general, post-contract, and pre-contract activities. The activities may comprise planning, analysis of needs, contract management, and managing the supplier relationships (CIPS Knowledge Team 2013 P.4). There is a thin line between procurement and purchasing. While purchasing involves payment of the bought goods and services, purchasing entails obtaining or buying of goods through leasing or borrowing as well as buying (Ngakaagae n.d., p. 1). However, in SCM, the two concepts are interchangeable.