Long-term relationships between customers and suppliers are critical to any orga

Question

Long-term relationships between customers and suppliers are critical to any organization's success. Purchasing at one time fell under the materials management function, and now is a seperate management. More recently, other groups have also been moved out of the materials management function such as logistics and supply chain. Explain why this trend has occurred and the resposibilities are of each of their functions within the organization. Then provide a statement differentiating the functions and explaining the responsibilities of materials, purchasing, logistics and supply chain in a multisite operation.

Explanation / Answer

The shift from the material management which used to take care of all the functions of management of logistics, supply chain, storing and integrating services, that is the complete care of the products that company purchase till their manufacturing process to the approach where functions have been broken down into separate category for being the effective and efficient and maintaining a different long term relationship between the suppliers and customer based on their nature of business. This trend has occurred as this gives the organization better capabilities to manage its various functions separately and effectively.

Responsibilities of materials, purchasing, logistics and supply chain in a multisite operation is the trend and are being taken care of effective by employing various principles of management.

Material purchasing is done by a separate department in the company which looks over the requirement of the company and according negotiates the contract with the supplier. Management of logistics are categorized in separate department which specifically oversee the movement of the product across the manufacturing process and improve any issue that my come up. Supply chain takes care of the overall situation from buying to storing in warehouse and dispatching to the customers of product that company builds

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