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SCM Trends:Corporate social responsibility:The economic, legal, ethical, discretionary expectations that society has of organizations at a given point in time.Green Supply Chain Trend Sustainable sourcing or Green Purchasing: A practice aimed at ensuring that purchasing personnel include environmental considerations and human health issues when making purchasing decisions; also termed green sourcing and sustainable procurement.Steps in the strategic sourcing process:Strategic sourcingis identifying ways to improve long term business performance by better understanding sourcing needs, developing long term sourcing strategies, selecting suppliers and managing the supply base. Strategic sourcing process1.Asses Opportunities 2.Profile Internally and Externally 3.Develop sourcing Strategy 4.Screen suppliers and create selection criteria 5.Conduct Supplier selection6.Negotiate and implement AgreementsSpend Analysis: The applications of quantitative techniques to purchasing data in an effort to better understand spending patterns and identify opportunities. Kralijic Portfolio Analysis (Quadrants)A structured approach to develop sourcing strategy for a product or service, based on the value potential and the relative complexity or risk represented by a souring opportunity. Routine Quadrant: Used for readily available products or services representing a small portion of firms purchasing expenditures.Leverage Quadrant:Standardized and readily available but used for representing a significant portion. Bottleneck Quadrant: Used for services with unique or complex requirements that can only be met by a few potential suppliers.Critical Quadrant: Products or service with unique or complex requirements coupled with limited supply base.Benefits for sourcing multiple suppliers: Buying firm shares its business across multiple suppliers.
Request for quotation (RFQ):A Formal request for the suppliers to prepare bids based on the terms and conditions set by the buyer.