Purchasing and Supply Management : With 50 Supply Chain Cases

by Leenders, Michiel; Johnson, P. Fraser; Flynn, Anna; Fearon, Harold

• ISBN13: 9780072873795
• ISBN10: 0072873795
• Edition: 13th
• Format: Hardcover
• Copyright: 2005-03-01
• Publisher: McGraw-Hill/Irwin

Summary

Purchasing and supply management has become increasingly visible in a world where supply is a major determinant of corporate survival and success. Supply chain performance influences not only operational and financial risks but also reputational risk. Extending the supply chain globally into developing countries places new responsibilities on supplier and supply, not only to monitor environmental, social, political and security concerns, but also to influence them. The job of today's supply manager goes beyond the scope of efficiency and value, into the search for competitive advantage. Book jacket.

Author Biography

Michiel Leenders, D.B.A., PMAC Fellow Leenders Purchasing Management Association of Canada Chair Professor of Purchasing Management Emeritus Richard Ivey School of Business The University of Western Ontario P. Fraser Johnson, Ph.D. Associate Professor, Operations Management Richard Ivey School of Business The University of Western Ontario Anna Flynn, Ph.D., C.P.M. Vice President Institute for Supply Management (formerly NAPM) Harold Fearon, Ph.D., C.P.M. The National Association of Purchasing Management Professor Emeritus and Founder and Director Emeritus Center for Advanced Purchasing Studies Arizona State University

Table of Contents

Purchasing and Supply Management	1	(26)
Purchasing and Supply Management	3	(3)
Definitions	4	(1)
Supply and Logistics	5	(1)
The Size of an Organization's Spend and Financial Significance	6	(2)
Supply Contribution	8	(5)
The Operational versus Strategic Contribution of Supply	9	(1)
The Direct and Indirect Contribution of Supply	9	(4)
Decision Making in the Supply Management Context	13	(1)
The Differences between Commercial and Consumer Acquisition	14	(1)
Supply Qualifications and Associations	14	(3)
Challenges Facing Purchasing and Supply Management over the Next Decade	17	(1)
Technology	17	(1)
Supply Chain Management	17	(1)
Measurement	17	(1)
Growth and Influence	17	(1)
Effective Contribution to Corporate Success	18	(1)
The Organization of This Text	18	(1)
Conclusion	19	(1)
Questions for Review and Discussion	19	(1)
References	19	(1)
Addresses	20	(1)
Cases	21	(6)
Custom Equipment	21	(2)
Roger Gray	23	(1)
Cottrill Inc.	24	(3)
Supply Organization	27	(31)
Objectives of Supply Management	29	(3)
Organizational Structures for Supply Management	32	(8)
Small and Medium-Sized Organizations	32	(1)
Specialization within the Supply Function	32	(4)
Large Organizations	36	(1)
Centralized Supply Structure	36	(1)
Decentralized Supply Structure	36	(1)
Hybrid Supply Structure	36	(2)
Structure for Direct and Indirect Spend	38	(1)
Managing Organizational Change in Supply	39	(1)
Organizing the Supply Group	40	(2)
The Chief Purchasing Officer (CPO)	40	(1)
Profile of the CPO	41	(1)
CPO Trends	41	(1)
Reporting Relationship	42	(1)
Supply Activities and Responsibilities	42	(3)
What Is Acquired	42	(1)
Supply Chain Activities	43	(1)
Type of Involvement	43	(1)
Involvement in Corporate Activities	44	(1)
Influence of the Industry Sector on Supply Activities	45	(1)
Supply Teams	45	(5)
Leading and Managing Teams	46	(1)
Cross-Functional Supply Teams	46	(2)
Teams with Supplier Participation	48	(1)
Teams with Customer Participation	48	(1)
Co-location of Supply with Internal Customers	48	(1)
Co-location of Suppliers in the Buying Organization	48	(1)
Supplier Councils	48	(1)
Supply Councils	49	(1)
Consortia	49	(1)
Conclusion	50	(1)
Questions for Review and Discussion	51	(1)
References	51	(1)
Cases	52	(6)
Duchess University	52	(2)
Roger Haskett	54	(4)
Supply Processes	58	(32)
The Supply Management Process	60	(2)
Strategy and Goal Alignment	60	(1)
Ensuring Process Compliance	61	(1)
Steps in the Supply Process	61	(1)
Recognition of Need	62	(1)
Description of the Need	62	(3)
Types of Requisitions	63	(1)
Flow of the Requisition	64	(1)
Early Supply and Supplier Involvement	65	(1)
Identification of Potential Sources	65	(2)
Issuing an RFx	65	(1)
Linking Organizational and Category Strategy	66	(1)
Supplier Selection and Determination of Terms	67	(1)
Preparation and Placement of the Purchase Order	67	(4)
Format and Routing	67	(4)
Follow-Up and Expediting	71	(2)
Cost and Benefits	73	(1)
Receipt and Inspection of Goods	73	(1)
Eliminating or Reducing Inspection	74	(1)
Invoice Clearing and Payment	74	(2)
Aligning Supply and Accounts Payable	75	(1)
Cash Discounts and Late Invoices	75	(1)
Streamlining the Receiving, Invoicing, and Payment Process	76	(1)
Maintenance of Records and Relationships	76	(1)
Linking Data to Decisions	77	(1)
Managing Supplier Relationships	77	(1)
A Supply Process Flowchart	77	(2)
Rush and Small-Value Orders	79	(2)
Rush or Emergency Orders	79	(1)
Small-Value Orders and Efficiency Tools	79	(2)
Policy and Procedure Manual	81	(2)
Conclusion	83	(1)
Questions for Review and Discussion	83	(1)
References	83	(1)
Cases	84	(6)
Mike Wesley	84	(2)
UIL Inc.	86	(1)
Southeastern University	87	(3)
Information Systems and Technology	90	(25)
Information Management	92	(2)
Information Systems	92	(2)
Information System Technology Use in Supply Management	94	(1)
Software	94	(1)
Commonly Used Technology Tools	95	(1)
Electronic Communication	96	(5)
Electronic Data Interchange (EDI)	96	(1)
Extensible Markup Language (XML)	97	(1)
Intranets and Extranets	98	(1)
E-Marketplaces	99	(1)
Electronic or Online Catalogs	99	(1)
RFID	100	(1)
Online Auctions	101	(4)
Reverse Auctions	102	(1)
When to Use Reverse Auctions	102	(1)
Conducting Reverse Auction Events	102	(1)
Ethical Issues with Reverse Auctions	103	(1)
Potential Problems with Using Online Auctions	104	(1)
Implications for Supply	105	(1)
Conclusion	106	(1)
Glossary of Terms	106	(2)
Questions for Review and Discussion	108	(1)
References	108	(1)
Cases	109	(6)
Cable and Wireless plc (A)	109	(1)
Establishing E-Business Standards at Deere & Company	110	(3)
Hemingway College	113	(2)
Quality, Specification, and Service	115	(33)
Determination of Need	116	(2)
Early Supply and Supplier Involvement	117	(1)
Methods of Description	118	(5)
Description by Brand	119	(1)
``Or Equal''	119	(1)
Description by Specification	119	(2)
Description by Engineering Drawing	121	(1)
Miscellaneous Methods of Description	121	(1)
Combination of Descriptive Methods	122	(1)
Sources of Specification Data	122	(1)
Standardization and Simplification	123	(1)
Quality, Suitability, and Best Buy	124	(6)
Quality	124	(1)
Suitability	125	(1)
Reliability	125	(1)
Quality Dimensions	125	(1)
``Best Buy''	126	(1)
Determining the ``Best Buy''	126	(1)
The Cost of Quality	126	(3)
Continuous Improvement	129	(1)
ISO 9000 Quality Standards and the Malcolm Baldrige Award	130	(1)
Total Quality Management (TQM)	131	(1)
Quality Function Deployment (QFD)	131	(1)
Inspection and Testing	132	(3)
Testing and Samples	132	(1)
Inspection	133	(1)
Quality Assurance and Quality Control	134	(1)
Process Control	135	(5)
Adjustments and Returns	139	(1)
Supplier Certification	140	(1)
Service	140	(1)
Conclusion	141	(1)
Questions for Review and Discussion	141	(1)
References	142	(1)
Cases	142	(6)
Bright Technology International	142	(2)
Air Quality Systems Inc.	144	(1)
Synergy Metals Inc.	145	(3)
Quantity and Inventory	148	(30)
Inventory Management	149	(1)
Functions and Forms of Inventories	150	(6)
The Functions of Inventory	150	(3)
The Forms of Inventory	153	(1)
Inventory Function and Form Framework	153	(2)
Managing Supply Chain Inventories	155	(1)
ABC Classification	156	(2)
Costs of Inventories	158	(2)
Forecasting	160	(1)
Forecasting Techniques	160	(1)
Determining Order Quantities and Inventory Levels	161	(5)
Fixed-Quantity Models	161	(2)
Fixed-Period Models	163	(1)
Probabilistic Models and Service Coverage	163	(1)
Buffer or Safety Stocks and Service Levels	164	(2)
Material Requirements Planning (MRP)	166	(2)
MRP Inputs	166	(1)
MRP Lot Sizing	166	(1)
Modern MRP Systems	167	(1)
Supply Implications of MRP	168	(1)
Lean Supply and JIT	168	(4)
Kanban Systems	170	(1)
JIT and Inventory Management	171	(1)
JIT Implications for Supply Management	171	(1)
Conclusion	172	(1)
Questions for Review and Discussion	172	(1)
References	172	(1)
Cases	173	(5)
Connecticut Circuit Manufacturers	173	(2)
Abbey Paquette	175	(1)
Sedgman Steel	176	(2)
Transportation and Delivery	178	(19)
Organization for Logistics Decisions	180	(1)
FOB Terms and Incoterms	180	(2)
Transportation	182	(2)
Supply's Involvement in Transportation	183	(1)
Transportation Regulation and Deregulation	183	(1)
Transportation Carriers	184	(3)
Motor Carriers	184	(1)
Rail Carriers and Intermodal	185	(1)
Air Carriers	185	(1)
Water Carriers	185	(1)
Pipelines	185	(1)
Selection of Mode and Carrier	186	(1)
Rates and Pricing	187	(1)
Other Transportation Service Providers	188	(1)
Documentation in Freight Shipments	189	(2)
Freight Audits	191	(1)
Expediting and Tracing Shipments	191	(1)
Developing a Transportation and Logistics Strategy	191	(1)
Conclusion	192	(1)
Questions for Review and Discussion	193	(1)
References	193	(1)
Cases	194	(3)
Great Western Bank	194	(1)
Geo Products	194	(1)
Penner Medical Products	195	(2)
Price	197	(37)
Relation of Cost to Price	198	(4)
Meaning of Cost	199	(2)
How Suppliers Establish Price	201	(1)
The Cost Approach	201	(1)
The Market Approach	201	(1)
Government Influence on Pricing	202	(1)
Legislation Affecting Price Determination	202	(1)
Types of Purchases	203	(4)
Raw Materials/Sensitive Commodities	204	(1)
Special Items	205	(1)
Standard Production Items	205	(1)
Small-Value Items	206	(1)
The Use of Quotations and Competitive Bidding	207	(4)
Firm Bidding	208	(1)
Determination of Most Advantageous Bid	209	(1)
Collusive Bidding	210	(1)
The Problem of Identical Prices	210	(1)
Provision for Price Changes	211	(2)
Contract Cancellation	213	(1)
Forward Buying and Commodities	214	(5)
Forward Buying versus Speculation	214	(1)
Organizing for Forward Buying	215	(1)
Control of Forward Buying	215	(1)
The Commodity Exchanges	216	(1)
Limitations of the Exchanges	217	(1)
Hedging	217	(2)
Sources of Information Regarding Price Trends	219	(1)
Conclusion	219	(1)
Questions for Review and Discussion	220	(1)
References	220	(1)
Cases	221	(13)
MasTech Inc.	221	(1)
Chevron Corporation: The PC Selection Team (Abridged)	222	(4)
Commodity Purchasing Game	226	(6)
Price Forecasting Exercise	232	(2)
Cost Management, Discounts, and Negotiation	234	(21)
Cost Management	235	(6)
Total Cost of Ownership	237	(1)
Target Pricing	238	(1)
The Learning Curve or Manufacturing Progress Function	239	(1)
Activity-Based Costing	240	(1)
Discounts	241	(5)
Cash Discounts	241	(1)
Trade Discounts	242	(1)
Multiple Discounts	242	(1)
Quantity Discounts	243	(1)
The Price-Discount Problem	243	(1)
Quantity Discounts and Source Selection	244	(1)
Cumulative or Volume Discounts	245	(1)
Negotiation	246	(4)
Negotiation Strategy and Practice	246	(2)
Framework for Planning and Preparing for Negotiation	248	(2)
Conclusion	250	(1)
Questions for Review and Discussion	250	(1)
References	251	(1)
Cases	251	(4)
Deere Cost Management	251	(2)
McMichael Inc.	253	(2)
Supplier Selection	255	(35)
The Supplier Selection Decision	256	(2)
Decision Trees	257	(1)
Identifying Potential Sources	258	(5)
Information Sources	259	(4)
The Evaluation of Potential Sources	263	(2)
Technical, Engineering, and Manufacturing and Distribution Strengths	263	(1)
Management and Financial Evaluation	264	(1)
Supplier Evaluation Methods	265	(4)
Informal and Semiformal Evaluation and Rating	266	(1)
Formal Supplier Evaluation and Rating	267	(2)
Linking Sourcing with Strategy	269	(13)
Single versus Multiple Sourcing	270	(2)
Manufacturer versus Distributor	272	(1)
Geographical Location of Sources	272	(1)
Supplier Size	273	(1)
Social, Political, and Environmental Concerns	274	(4)
Joint Purchasing with Supplier	278	(1)
Purchasing for Company Personnel	278	(1)
Risk Assessment	279	(1)
Strategy Development	280	(2)
Conclusion	282	(1)
Questions for Review and Discussion	282	(1)
References	282	(1)
Cases	283	(7)
Quotech Inc.	283	(2)
Bid Evaluation	285	(3)
Somers Office Products Inc.	288	(2)
Investment Recovery	290	(18)
North American Environmental Initiatives	292	(1)
ISO 14000 Environmental Standards	293	(1)
Benefits of Effective Disposal	294	(1)
Categories of Material for Disposal	295	(4)
Excess or Surplus Materials	296	(1)
Obsolete Material or Equipment	296	(1)
Rejected End Products	296	(1)
Scrap Material	297	(1)
Waste	297	(1)
Hazardous Waste	298	(1)
Responsibility for Material Disposal	299	(1)
Keys to Profitable Disposal	300	(1)
Disposal Channels	300	(2)
Disposal Procedures	302	(1)
Selecting the Right Disposal Partner	303	(1)
Conclusion	304	(1)
Questions for Review and Discussion	305	(1)
References	305	(1)
Cases	306	(2)
Miltec Inc.	306	(1)
Ornex	306	(2)
Supply Law and Ethics	308	(34)
Legal Authority	309	(2)
Personal Liability	311	(1)
Authority of Suppliers' Representatives	312	(1)
The Uniform Commercial Code	312	(9)
The Purchase Order Contract	313	(1)
Acceptance of Orders	314	(1)
Purchases Made Orally--Statute of Frauds	315	(1)
Inspection	316	(1)
Acceptance and Rejection of Goods	317	(1)
Warranties	318	(1)
Title to Purchased Goods	319	(1)
Protection against Price Fluctuations	319	(1)
Cancellation of Orders and Breach of Contract	320	(1)
Common Law and the Purchase of Services	321	(1)
E-Commerce and the Law	321	(3)
Electronic Signatures	322	(1)
Uniform Electronic Transactions Act	323	(1)
Antitrust and E-Marketplaces	323	(1)
Intellectual Property Laws	324	(2)
Copy right Law	324	(1)
Patents	325	(1)
Trademarks	326	(1)
Industrial Design	326	(1)
Geographical Indication	326	(1)
Product Liability	326	(1)
Alternative Dispute Resolution	327	(2)
Commercial Arbitration	328	(1)
Mediation	328	(1)
Internal Escalation	329	(1)
The Sarbanes-Oxley Act	329	(1)
Ethics	329	(6)
Perceptions and Conflict of Interest	332	(1)
Gifts and Gratuities	332	(2)
Promotion of Positive Relationships with Suppliers	334	(1)
Reciprocity	335	(1)
Social Responsibility	335	(2)
Conclusion	337	(1)
Questions for Review and Discussion	337	(1)
References	338	(1)
Cases	338	(4)
Brassco	338	(1)
Lancaster Life Insurance Co.	339	(3)
Research and Metrics	342	(28)
Organizing for Supply Research	343	(3)
Full-Time or Part-Time Research Positions	345	(1)
Cross-Functional Teams	345	(1)
Supply Research Opportunities	346	(7)
Purchased Materials, Products, or Services	347	(1)
Value Analysis	347	(2)
Target Costing	349	(1)
Commodities	350	(1)
Suppliers	351	(2)
Relationship Classification	353	(1)
Supply Processes	353	(1)
Assessing Research Results	354	(1)
Supply Planning Process	354	(1)
Supply Budgets	354	(1)
Performance Measurement Systems	355	(4)
The Value of Supply Metrics	355	(1)
The Challenges	356	(1)
Measuring Supplier Performance	357	(1)
Key Supplier Performance Indicators	357	(1)
Supply Management Performance Metrics	357	(2)
Establishing Metrics	359	(4)
Efficiency Metrics	359	(1)
Effectiveness Metrics	359	(1)
Operating Reports	359	(2)
Validating Results	361	(1)
Appraising Team Performance	361	(1)
Supply Performance Benchmarking	361	(2)
Conclusion	363	(1)
Questions for Review and Discussion	363	(1)
References	363	(1)
Cases	364	(6)
City of Granston	364	(2)
Industrial Products Corporation (IPC)	366	(4)
Global Supply	370	(28)
The Importance of Global Supply	371	(3)
Reasons for Global Purchasing	372	(2)
Potential Problem Areas	374	(6)
Incoterms	380	(3)
Information Sources for Locating and Evaluating International Suppliers	383	(1)
Global Sourcing Organizations	384	(2)
Intermediaries	386	(1)
Countertrade	386	(3)
Barter/Swaps	387	(1)
Offset Arrangements	387	(1)
Counterpurchase	387	(1)
Buyback/Compensation	387	(1)
Switch Trade	388	(1)
Foreign Trade Zones	389	(3)
Foreign Trade Zones Compared with Bonded Warehouses	391	(1)
Maquiladoras	391	(1)
TIBs and Duty Drawbacks	391	(1)
Free Trade Agreements	392	(1)
Conclusion	392	(1)
Questions for Review and Discussion	393	(1)
References	393	(1)
Cases	394	(4)
Global Pharmaceuticals Ltd.	394	(1)
Andrew Morton	395	(3)
Public Supply Management	398	(24)
Characteristics of Public Supply	400	(5)
Source of Authority	400	(1)
Budgetary Restrictions/Limitations	401	(1)
Outside Pressures	401	(1)
Government Programs	401	(1)
Interest Costs	402	(1)
Inspection	403	(1)
Transportation and Logistics	403	(1)
Past Performance and Switching Cost	403	(1)
Transparency and Confidentiality	404	(1)
Importance of Specifications	404	(1)
Acquisition Procedures	405	(4)
The Bid Process	405	(4)
Military Supply	409	(2)
Firm-Fixed-Price (FFP) Contract	410	(1)
Cost-Plus-Fixed-Fee (CPFF) Contract	410	(1)
Cost-No-Fee (CNF) Contract	410	(1)
Cost-Plus-Incentive-Fee (CPIF) Contract	410	(1)
State, Local, and Municipal Supply	411	(2)
Cooperative or Consortium Purchasing	411	(1)
Governmentwide and Cooperative Contracts	412	(1)
Local-Bidder Preference Laws	412	(1)
Model Procurement Code	413	(1)
Public Supply Changes	414	(1)
Use of Electronic/Internet-Based Systems	414	(1)
Involvement in Services Spend	414	(1)
Multiyear Contracts	414	(1)
Privatization	414	(1)
Simplified Acquisition Procedures	415	(1)
Commercial Practices	415	(1)
Conclusion	415	(1)
Questions for Review and Discussion	416	(1)
References	416	(1)
Cases	417	(5)
TriCity	417	(2)
Fairview School Board	419	(3)
Capital Goods	422	(25)
The Challenge of Procuring Capital Assets	423	(1)
New Technology---New Equipment	424	(3)
Equipment Classification	425	(1)
Challenges of Equipment Buying	426	(1)
Sourcing and Supply Issues	427	(4)
Design and R&D Considerations	427	(1)
Engineering Service	428	(1)
Importance of Cost Factors	428	(1)
Life Cycle Costing or Total Cost of Ownership	429	(1)
Budgeting Procedures	429	(1)
Sourcing and Selection	430	(1)
Legal Issues	430	(1)
Disposition of Obsolete or Replaced Equipment	431	(1)
Reasons for Buying Used Equipment	431	(1)
Sales Contract Terms	432	(1)
Leasing Equipment	432	(4)
Advantages and Disadvantages of Leasing	433	(1)
Types of Leases	434	(1)
Categories of Leasing Companies	434	(2)
Lessor Evaluation	436	(1)
The Acquisition of Technology	436	(1)
The Acquisition of Construction	437	(5)
Risks in the Construction Process	438	(1)
Approaches to Construction Acquisition	438	(2)
On-Site Considerations in Construction	440	(1)
Sustainable Building	440	(1)
Supply's Involvement in Construction	441	(1)
Conclusion	442	(1)
Questions for Review and Discussion	442	(1)
References	442	(1)
Cases	443	(4)
Mark Appleton	443	(1)
Casson Construction	443	(4)
Services	447	(28)
Services	448	(3)
Significance of Services Spend	449	(1)
What Makes Services Different?	449	(1)
Supply Involvement	450	(1)
A Framework for Analyzing Services	451	(4)
Value of the Service	452	(1)
Degree of Repetitiveness	452	(1)
Degree of Tangibility	452	(1)
Direction of the Service	453	(1)
Production of the Service	453	(1)
Nature of the Demand	454	(1)
Nature of Service Delivery	454	(1)
Degree of Standardization	454	(1)
Skills Required for the Service	455	(1)
The Acquisition Process for Services	455	(8)
Need Recognition and Description	455	(2)
Analysis of Supply Alternatives	457	(3)
The Purchase Agreement	460	(1)
Service Contract Administration	461	(2)
Developing a Services Sourcing Strategy	463	(1)
Outsourcing and Managing Third-party Service Providers	463	(1)
Expanding Supply's Involvement	463	(4)
Process Steps	466	(1)
Conclusion	467	(1)
Questions for Review and Discussion	467	(1)
References	467	(1)
Cases	468	(7)
Erica Carson	468	(1)
Talbot County School Board	468	(1)
Hampton Manor	469	(6)
Make or Buy, Insourcing, and Outsourcing	475	(18)
Make or Buy	476	(3)
Reasons for Make Instead of Buy	477	(1)
Reasons for Buying Outside	478	(1)
The Gray Zone in Make or Buy	479	(1)
Subcontracting	479	(1)
Insourcing and Outsourcing	480	(1)
Insourcing	481	(1)
Outsourcing	482	(1)
Outsourcing Purchasing and Logistics	483	(1)
Purchasing's Role in Outsourcing	484	(1)
Conclusion	485	(1)
Questions for Review and Discussion	485	(1)
References	485	(1)
Cases	486	(7)
B&L Inc.	486	(1)
Rondot Automotive	487	(1)
Huson Manufacturing	488	(5)
Supplier Relations	493	(30)
Purchaser-Supplier Relations	496	(1)
Supplier Goodwill	496	(1)
The Purchaser-Supplier Satisfaction Matrix	497	(3)
Tools and Techniques for Moving Positions	499	(1)
Purchaser-Supplier Relationship Management	500	(1)
Supplier Ranking	500	(2)
Partnerships	502	(3)
SEMATECH's Partnering Perspective	503	(1)
Early Supplier Involvement (ESI)/Early Purchasing Involvement (EPI)	503	(1)
Partner Selection	504	(1)
The Longer Time Perspective	504	(1)
Co-location/In-plants	505	(1)
Strategic Alliances	505	(2)
Concerns about Partnerships	506	(1)
Reverse Marketing/Supplier Development	507	(2)
Supply Chain Management	509	(3)
Supply Networks	510	(2)
Conclusion	512	(1)
Questions for Review and Discussion	513	(1)
References	513	(1)
Cases	514	(9)
Plastic Cable Clips	514	(3)
Loren Inc.	517	(6)
Strategy in Purchasing and Supply Management	523	(25)
Levels of Strategic Planning	524	(2)
Major Challenges in Setting Supply Objectives and Strategies	526	(1)
Strategic Planning in Purchasing and Supply Management	526	(1)
Major Supply Strategy Areas	526	(1)
Risk Management	527	(3)
Supply Interruptions and Delays	527	(1)
Changes in Prices	528	(1)
Reputational Risk	528	(1)
Managing Supply Risks	528	(1)
The Corporate Context	529	(1)
Strategic Components	530	(4)
What?	530	(1)
Quality?	530	(2)
How Much?	532	(1)
Who?	532	(1)
When?	533	(1)
What Price?	533	(1)
Where?	533	(1)
How?	533	(1)
Why?	533	(1)
What is Happening in Purchasing and Supply Management	534	(2)
Conclusion	536	(1)
Questions for Review and Discussion	537	(1)
References	537	(1)
Cases	538	(9)
Spartan Heat Exchangers Inc.	538	(2)
Sabor Inc.	540	(2)
Iowa Elevators	542	(5)
Indexes
Case Index	547	(1)
Subject Index	548