Introduction
The procurement cycle is the procedures that have to occur to supply the line of production or stock up goods and services in an organization. Therefore, all items that have to be procured should be identified to determine the required quantities at the initial stage. At the first step, the relevant information is used to generate the requisition that is later sent to the Department of purchasing. In this department, the assigned purchasers will request for bids and gives out the purchase order to the vendor. At the arrival of the order of the items, they will be entered into the system of inventory. However, the parameters for procurement cycle can be set by a usual schedule of production and varies based on the consumer demand.
The integration of knowledge and values across the organization is the main element of corporate responsibility in Nike Company. For instance, the great integration originates from the global procurement and this is the source of non-product suppliers in Nike Inc. for instance, five years ago, the global procurement has associated with Nike Inc. to boost the sustainability of goods and services that the company purchase. The purchasing power of this incorporation is leveraged by the procurement team by communicating the aims of sustainability to the potential suppliers. Similarly, these suppliers are challenged to deliver innovative products that can meet the objectives of Nike Inc.
According to the management of the company, this procurement procedure is essential because it build markets for more sustainable products with affordable options. Therefore, the company decided to build on this procedure and other lessons learned while evaluating the performance of corporate responsibility and prospective suppliers.
Consequently, the management of this Nike Inc. has understood the art of obtaining goods and services and its procurement cycle follows specific procedures while identifying the company requirements especially in the last step of the award of the procurement contract. In this company, the management is responsible to public as it considers corporate funds to be important when handling procurement process either in strong or weak economic markets. The following are the proven procurement steps in Nike Inc. that have assisted its management team to achieve successful goals:
Nike Inc. is aware and needs goods and services both from internal and external sources because these products may be the specific ones that might be reordered or may the new products for the company.
Specific Need
The right goods are important for Nike Company, and this has helped it the determination of its specifications. Similarly, it also applies the use of part numbers during the identification of better products, and it identifies the product that is necessary through the use of identifiers such as color.
Option of the sources
The company determines the exact place to obtain its products that are it has a list of approved vendors. Otherwise, Nike Inc. will look for the suppliers by use of purchase orders and other sources such as magazines and its sales representatives. Therefore, the company will qualify the suppliers to control the best product for the company.
Pricing and Terms
Nike Inc. has investigated the relevant information while determining the best product pricing and terms. However, this has depended on the company commodity needs and the specialized materials. Consequently. The company has accessed the supplier before making final decisions.
Purchase Order
The company has applied the use of purchase order in buying the materials especially between the buyer and the seller. The price is defined specifically including the specifications and terms and conditions of its goods and services plus any additional procurement obligations.
Delivery of the product
The company makes its delivery through fax, emails, and other electronic means. However, sometimes specific delivery means are specified in the documents of purchase and the receipt of the purchase order is acknowledged. Therefore, both parties will keep a copy of the supplied file. Expediting
The purchase order expedition will address only the goods and services that are delivered promptly, and it is important if any delays occur. The step often notes the date of payments, completion of the procurement process, and delivery of goods and services.
Receipt of Purchases
After the sender has delivered the products, the recipient company will either accept or reject the goods. Otherwise, the acceptance of the goods would mean that the recipient company will pay for the items.
Approval of the Invoice and Payment
The procurement department in Nike Inc. has to make sure that the invoice, receiving documents, and the original purchase order matches each other. The marching of the above documents gives the company and the supplier a confirmation of the products and any difference has to be resolved before the bill is paid.
Record Maintaining records
The company has kept procurement records for the purpose of auditing. The necessary records are the purchase records for the verification of tax information and purchase orders for the confirmation of warranty information. Similarly, purchase records are kept for future records.
Findings
The process of procurement has assisted the company in the determination of its baseline for no product items and the service suppliers. It has also helped Nike Inc. to evaluate its potential and new suppliers against the baseline, thereby the company can learn from the available data for future purchasing decisions. For instance, during the FY 2009, the company requested for over one hundred suppliers that can complete the survey. Therefore, many responses have shown a variation on the part of the suppliers and this revealed important differences between large, small institutions.
In an effort of moving forward, the company decided to establish acceptable corporate responsibility that the suppliers could need to do business with Nike Inc. the company has also planned to establish the forum for suppliers to share innovations and procurement solutions.
Conclusion
Through the procurement process, Nike Inc. has detected some of its challenges such as inadequate common indicators for the evaluation of its potential suppliers. Therefore, in the achievement of the procurement goals, the company developed the supplier scorecard to assess the match the company's values and the potential suppliers. Consequently, many questions have been asked concerning the procurement policies and performance regarding the relevant issues such as compliance and competition that deals with the diversity practices of the supplier. The company considers queries as a universal tool to all suppliers. Therefore, they are available on the company's website, and this enables Nike Inc. to make a review of each profile of the suppliers. Consequently, establishing a baseline for peer groups and the overall supply base of the company
