...Executive Summary My decision as the Supply manager of Blozis company, a as medium sized family owned, manufacturer of highly technical equipment is to find a lasting solution to the recurrent problems in the Company supplies department. Being a small scale family business, the President liked to operate “informally”, this makes it difficult for the supplies department to properly carry out its role. There is haphazard purchasing procedure which is not being followed. There is poor record keeping by which has lead to lose or equipment that was ordered and was never got to the internal customer, customers not being paid as at when due. The engineering and Production are not able to properly describe what they need. And worst of all the Expediter is sometimes playing the role of the buyer and his own office is neglected, to the point of not being able to keep proper records. As the Supply Manager I need to device a smooth working procurement process such that both internal and external customers are satisfied and production gets what they need, when they need it. I need to make the department functional and more productive such that there is less rush samples and time and money spent on order processing is greatly reduced. At this point it will be necessary for me to convince the president of the need to adopt an Electronic Date Interchange system, such that the whole process will run in a continuous unbroken chain as against the situation now. Key Assumptions •...
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...BLOZIS COMPANY Executive Summary: Blozis Company a manufacturer of highly technical equipment made $16 million gross sales by the engineering department. The supply department consisted of the supply manager, a buyer and two clerks. Multiple problems led up to the main problem in this case, one of those is the fact the engineering and production departments would contact the expediter in ordering instead of going through the requisitioner. This in turn caused faulty paperwork on items leaving the stockroom and the books would start to get out of order. Another problem was that there isn’t enough communication between departments and this has led to drop in efficiency. Everyone claims they did their job correctly but there isn’t a paper trail to prove it. Assumptions: The supply manager had no technical training on the job which is highly technical in nature, it was assumed that he had a fair grasp of the engineering terminology used in the field and so she could handle the department. She definitely was dealing with as little as she understood and so the expeditor took over the procurement process bypassing the important part of the process. The expediter who was formerly one of the technicians in the production shop and had some technical training in the army but had no background in strategic procurement processes was often contacted on ordering problems, he was not following...
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...Executive Summary Currently Blozis Company is facing many internal issues due to an absence of communication and control. The supply department is exhibiting weak control over materials and the overall supply management performance. The implementation of a supply management process will give the organization control of its operations. The large number of items, the large dollar value involved, the need for an audit trail, the severe consequences of poor performance, and the potential contribution to effective organizational operations inherent in the function are five major reasons for developing a robust process. The acquisition process is closely tied to almost all other business processes included in the organization and also to the external environment, creating a need for complete information systems and cross-functional cooperation. Issue Identification There is a lack of communication and control across this organization. The expediter is overworked, as he is involved in more than his assigned tasks. He is consulted by engineering or production when there are ordering problems, he also writes commercial specifications for these departments, types the requisitions, issues purchase orders, picks up rush orders, and supervises the stock room. There is no segregation of duties as anyone in the company is allowed to initiate a requisition. As a result of the informal operations, the engineering and production departments have difficulties staying within budget as the...
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...Part 1: Executive Summary Blozis Company is facing several procurement process issues due to an absence of communication, control and leadership from the top down. The organizational culture and attitude toward the business process has led to dysfunction and increased costs. The supply department is exhibiting weak control over materials handling and the overall supply management performance. The implementation of a supply management process will give the organization back the control over its operations and business culture. The potential contribution to effective organizational operations is essential in the function of an inventory cataloged system for recurring material purchase items, structure and discipline across the organization and position focus and restructuring. By recommending and successfully implementing purchasing procedures and material receiving control Blozis will be able to better utilize strengths already within the organization and hone on new found strengths through proper management structure and advanced technical specification training. Part 2: Issue Identification The primary issue faced by Blozis Company is an absence of communication and control throughout its procurement process. Uncertainty and misalignment is evident across their decentralized and informal supply chain. Anyone in the company can initiate requisitions and material can be purchased with minimal to no approval. The informal presence and lack of leadership from the...
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...Blozis Case Report Executive Summary My decision as the Supply manager of Blozis company, a as medium sized family owned, manufacturer of highly technical equipment is to find a lasting solution to the recurrent problems in the Company supplies department. Being a small scale family business, the President liked to operate “informally”, this makes it difficult for the supplies department to properly carry out its role. There is haphazard purchasing procedure which is not being followed. There is poor record keeping by which has led to loose or equipment that was ordered and was never got to the internal customer, customers not being paid as at when due. The engineering and Production are not able to properly describe what they need. And worst of all the Expediter is sometimes playing the role of the buyer and his own office is neglected, to the point of not being able to keep proper records. As the Supply Manager I need to device a smooth working procurement process such that both internal and external customers are satisfied and production gets what they need, when they need it. I need to make the department functional and more productive such that there is less rush samples and time and money spent on order processing is greatly reduced. At this point it will be necessary for me to convince the president of the need to adopt an Electronic Date Interchange system, such that the whole process will run in a continuous unbroken chain as against the situation now. ...
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...Summary The Blozis Company’s supply department has an unclear procurement process due to ambiguous roles and responsibilities of their employees. For the company to overcome the challenges that they are afflicted with, the company needs to undertake a sequence of activities to align the employees with a set of standard procurement processes. The president should clarify and define each employee’s roles and responsibilities, hire additional staff to share the workload and consider an electronic system to improve the procurement process. Issue identification, Cause and Analysis The case study illustrates several inefficiencies that are costing Blozis exceptional amount of money. The supply chain function is not organized and exemplifies weak control over any supply chain processes. The supply chain manager has little control over the processes in their managing area. The employee roles, at Blozis, do not seem to have a defined job description. For example, the supply department consists of two clerks, which one in the stock room, reports to the expeditor. This raises organizational clarity issues, as the clerk is hired under the supply department while reporting to the expeditor whom is under the production department. Both the clerk and the expeditor’s roles are more convoluted than what is necessary and is displayed by the long overdue payments on materials as well as materials being received improperly. Continuation Currently, the person who understands...
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...GANIYAT DADA PMAC # 2002005 MODULE 2 PROCUREMENT AND SUPPLY MANAGEMENT SESSION 2 BLOZIS COMPANY CASE REPORT JANUARY 27, 2011 Part 1: Executive Summary As the Supply Manager of Blozis Company my recommendation will be to initiate and implement the ten steps that involves the activities that results in the acquisition of required good or service. The very first thing to do is to build consensus within the organization around the opportunities to add value to the organization. Supply process is basically a communication process, this is clearly lacking in this organization. The departmental managers did not know the materials been charged to their cost centers until monthly accounting statements were released. There is no proper documentation of orders placed and received. As a result items were misplaced and suppliers were not paid as per the payment terms. As the Supply Manager of Blozis I need to put the correct process in place to will follow best practice of the procurement process. I will need to determine what needs to be communicated, to whom, and in what format and time frame; all this will help will translate to an efficient and effective supply management process. Table of Content Executive Summary Page Part 1 Executive Summary Part 2 Table of Content Part 3 Introduction /...
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...invoices for items that could not be matched to corresponding purchase order. 2. Purchasing procedures at Blozis are related to specifications, the use of requisitions, purchase orders, and receipt and delivery. Should these be changed? Why or why not? If they should be changed, how? Problems: Yes they should be changed because the current processes will only generate a lot of inaccuracies in the inventory and documentations. Current inventory and purchasing process allows for inventory to go missing, late payments to suppliers as well as mismatched receiving of invoices with purchase orders. No proper tracking and accounting of inventory is possible. Early payment discounts are also missed. The lack of documentation for the items picked up is not helping the departments to stay within budget. Corners are being cut with the way the system works. Two micrometers are lost because the expeditor most likely has picked up them up at the receiving dock and has taken them directly to the engineers. Since no documentation was in place to illustrate what has happened, it has become a financial and time loss to the company. Supply department also has to face with invoice for which they have no confirming documentation to support the payment for. There are also issues with suppliers claiming long overdue payments on materials that have been received by Blozis Company. Supply department would not do payment until they have received the receiving report, which is a good...
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...Executive Summary My decision is to immediately perform a process analysis of our entire procurement process. To this extent I will perform an analysis of the current roles and responsibilities of each person involved in the procurement process from “Need Recognition” through to “Payment”. This will involve defining and changing the roles and responsibilities of some departments and personnel. It will also involve tightening our inventory control practices. I will also be initiating the hiring requisition form to arrange for a new parts driver to perform pick-ups and deliveries. Key assumptions • The problems that we are currently experiencing will continue unless clear definition of roles and responsibilities are given. • There are currently no clear guidelines and procedures for the procurement process including a current process map. • There will be resistance to making the changes from various personnel regarding the change of roles and responsibilities. There may also be resistance from various personnel regarding the tightening of inventory control that will be implemented as his may be construed as a lack of trust. • Our expeditor is unable to carry out his duties of inventory control as effectively as possible due to much of his time being spent doing deliveries and pick-ups for parts. • Unless full control of Purchase Orders are undertaken by designated personnel we will continue to have problems with the 3 way matching process on accounts payable of PO,...
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...On reviewing the supply function in the Blozis Company it is clear that it is not organized at all. It works under a tactical strategy with many holes in its informal policies and procedures. Some of the key issues/Problems that have been identified are as follows: * There is no proper approval policy. * Lack of technical training or knowledge in the Supply Department. * Verbal not written descriptions were provided by engineering. * Supply Manager has no technical training. * General supply buyer handles technical items. * Expeditor attached to production spends over 50% of his time picking up items every day, also makes changes to specifications without approval and has too much authorization for his position. * Stock room is managed by a clerk with almost no supervision from the Expeditor to whom that position reports. * Stock room clerk could dispose of slow moving or deteriorated goods without approval. * No proper tracking of delivery receipts. * Long overdue payments are frequent and sizable discounts had been missed due to lack of receiving reports received by the Supply department. * In rush situation purchase orders are created by expeditor not the supply department. * Suppliers were delivering goods in rush situations without a signature from the supply manager. * Anyone in the company could initiate requisitions. * No formal signature policy. * No discipline actions for wrongdoing. The causes of the issues...
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