Procurement and Performance Management - Coursework Example

The orders are made on the schedule of production. Subsequently, it is essential that suppliers are connected with production schedule. The producer may not delay production for supplier’s lead time (SBANC, 2007). Model of Procurement Cycle Source: (University of Exeter, 2011). The figure mentioned above depicts the stages of procurement cycle. In the first stage, the producers recognise the requirements, and they analyse the suppliers and the related price. Supplier appraisal is generally identified as a risk management related tool to identify the viability of purchasing from a particular supplier or firm (Erridge & Et. Al., 2001).

Then, the suppliers forward a quotation to the producers. After that, the producers negotiate for price and they formulate a deal for the purchase at estimated value and suppliers are requested to despatch the product within a particular period of time. Next, the producers have to develop a healthy relationship with the suppliers for delivering the orders at earliest. After a satisfactory delivery is made, the contract is closed (University of Exeter, 2011). Dove House Engineering Plc (DHE) operates in ‘Make to Customer Order’ mode.

The consultants appointed by the management of DHE have identified certain problems related with the deficiencies of finished products in warehouse. DHE management should look into this matter because they have no warehouse at all. The sole warehouse is far away from production site and there is lack of adequate rooms for filling up the inventories. DHE had not launched computerised production planning and control system yet, there production planning is still done manually. DHE is miles away from its competitors because of several deficiencies in managing their operations affluently.

They do not even concentrate on the quality of the products. The procurement process still depends on conventional way. It also hampers the strategies for production process. They frequently change their suppliers that have a strong influence on the procurement cycle (Case Study, n.d.). At present, the market is highly competitive and customers look for immediate delivery and quality products in affordable rates. Thus, DHE have to enhance its capacity in warehouse so that the production as well as the delivery does not get affected.

They have to build long-term relationship with the suppliers so that suppliers feel motivated to supply the necessary materials in short period of time. They should upgrade their systems for managing the production planning. DHE should fulfil all the requirements of employees as well as customers. They should encourage suppliers to supply quality materials so that they can produce quality products as per customer requirements. They are facing challenges due to scarcity of stock in inventory. They have to concentrate on fluent supply of materials needed for production so that production does not get hampered due to lack of primary materials.

They have to obtain customer feedback with regard to quality and set up further strategies. They are confused regarding the production facilities; they have to select one of the production facilities which are feasible and cost-effective for them. They should establish a new warehouse closer to production site. They have to reshuffle their organisational structure. By implementing the recommendations, DHE can regain their position and sustain in the competitive business world. 2. Role of Procurement Staffs and