| A negotiation is a dialogue between two or more parties to resolve a disputes or come to an agreement and Negotiation Management is the practice of managing your negotiation strategies, practices, and methodologies while keeping track of how well you doing with respect to identified best-in-class practices and results. In the context of the supply chain, a negotiation usually refers to a formal discussion between a buyer and one or more suppliers with the goal of securing the supply of raw materials, goods, and / or services and negotiation management refers to the process of managing the negotiation with the intent of getting the best possible result.
Negotiation skills are a fundamental building block of negotiation management, and in addition to the ability to ask questions, listen, and construct valid arguments based on market research, the following skills are often requirements of success in any negotiation:
For more information on negotiation management in the supply chain, and strategies for success, please refer to the following posts: |
Monthly Archives: January 2005
Market Intelligence
| Market Intelligence can be defined as the information relevant to the company’s markets, gathered and analyzed specifically for the purpose of accurate and confident decision making in determining market opportunity, market penetration strategy, and market development metrics. (Wikipedia) In the context of the supply chain, it’s generally used to refer to the information relevant to the company’s Supply Management practice which includes commodity market information, supplier information, and category management best practices.
Providers of market intelligence solutions will usually focus on metric-driven industry benchmarks, pricing indexes, customer-driven or supplier-driven surveys and case studies, industry production data, and/or current industry best practices. They will also typically address one or more of the following “dimensions” in their analysis:
Consumers of Market Intelligence can obtain the information from a number of sources, including:
For more information on market intelligence in the supply chain, please refer to the following posts:
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Logistics Management
| Logistics Management, as defined in Wikipedia, is generally defined as the management of the flow of goods, information, and other resources, including energy and people, between the point of origin and the point of consumption in order to meet the requirements of the end consumers. It often encompasses information visibility and integration, transportation and distribution, inventory management, warehousing, material handling, and packaging.
Believed to have been originated by ancient militaries who needed to supply themselves with arms, ammunitions, and rations as they moved from their base to a forward position, logistics management has evolved beyond the military to include a considerable portion of the modern supply chain function. In today’s supply chain, logistics management is responsible for controlling the efficient forward and reverse flow and storage of goods, services, and information between the point of origin and the point of consumption; overlaps with inventory and warehouse management, global trade management, and supply chain finance; and may involve the use of third party logistics. For additional insights into Logistics Management, see the following posts: |
Knowledge Management
| Knowledge Management can be defined as a range of practices and methodologies, which may or may not be based on technological solutions, that enable the identification, creation, representation, capture, search, sharing, and distribution of knowledge. Like compliance management, knowledge management is another universally nebulous concept where every proponent in business administration, information systems, management, and library and information sciences will give you a similar, but slightly contradictory, definition.
A Knowledge Management effort is generally undertaken by an organization looking to accomplish one or more organizational objectives, which may included efficiency and performance improvements, the establishment of a competitive advantage, intra-organizational information sharing, a continuous improvement initiative, service management, and talent management. Such efforts often overlap with change management efforts, organizational learning, and wide-spread retraining efforts. The focus of the effort might take many forms, including:
Done right, Knowledge Management can benefit every major practice area of the supply chain, including:
For more insights into how Knowledge Management can benefit your supply chain, please see:
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Inventory Management
| As per Wikipedia, inventory consists of the goods and materials held available in stock by a business. Inventory Management is the process of managing inventory in an effort to insure that a business has the goods and materials available when it needs them, but does stock the goods and materials it does not need, or stock materials too far in advance of the actual need due to the associated cost with warehousing the materials.
Advanced inventory management, also referred to as inventory optimization, is becoming more common as companies look to lean their operations and supply chains. These strategies include Just-in-Time inventory management, Vendor Managed Inventory, advanced forecasting, and even donating excess inventory. The reality is that inventory, whose carrying cost can often exceed 30% of the product value, is expensive, and better management can greatly reduce the overhead costs, as well as the depreciation losses associated with holding too much inventory. For additional information on inventory management and inventory reduction strategies, refer to the following posts: |