Internet/extranet technology enables partners in a value chain to jointly prepare forward plans, building up shared files of data on the network via electronic collaboration. (McGuffog, nd)
Functions such as distribution, marketing and manufacture will be outsourced to firms with specialist capabilities. Sourcing of all non-tactical products and services under master contracts will be common. Small and medium sized companies will do this through consortiums. Tactical purchasing will be automated through the Internet. Where price is the main criterion, companies will use software to search among pre-qualified suppliers on the Net. Online tendering and bidding systems will also be used. However, supplier evaluation, selection, performance monitoring and development will continue to be essential activities for purchasing personnel. The scope of automation and alliances in the field of procurement is illustrated in Procurement and the scope of automation and alliances.
Figure 9: Procurement and the scope of automation and alliances
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