Module 06 Written Assignment - Presentation

Procurement Process Analysis

Introduction

The act of acquiring services and products, usually for commercial objectives, is known as procurement. Procurement typically represents the ultimate symbol of purchasing, but it may also mean the entire acquisition process, which is crucial for businesses before making their final purchase choice. Therefore, procurement plays an essential role in any industry. The role of procurement is to conduct purchases for an organization and ensure the availability of quality inventory at the right time. For a medical company developing an efficient procurement, the unit essentially enables the organization to comply with legal requirements and have quality stock for the business's smooth running. To support efficiency and eliminate time wastage and the possibility of losing life, a medical facility needs to promote efficient stocking and a timely ordering process. In the article, we will discuss the crucial role that stocking and convenient ordering process play in determining the success of a health institution and later provide a step-by-step process through which one can avoid last-minute lack of stock situation like the one faced by Dr. Smiths.

The importance of stocking

For every business having optimum stock is one of the crucial aspects that would ensure the company's continuity and minimize hiccups. Stock or inventory represents the goods and merchandise kept on a business premise to enable and promote revenue generation through selling, manufacturing, and provision of services (Scheibel & Blackhurst, 2018). The medical industry is one of the crucial industries as it plays an essential role in determining the community's quality of life. Therefore, it is necessary to conduct a thorough and prudent stocking process as it will help in reducing lead time and eliminating the possibility of running out of stocks.

· Having optimum stock in an organization is critical as it helps promote productivity and efficiency in the workplace. Efficiency is improved within an organization when there is quality stock, as quality stock will help produce quality services or goods.

· Stocking at the right time enables an organization to avoid time and money wastage. Time is wasted when employees have to wait for the product to be delivered before commencing their duties.

· Furthermore, due to the short time available when a product is hastily required in an organization, the procurement unit is deprived of the requisite time to conduct a dynamic procurement process and embark on panic purchasing that is costly and runs the risk of acquiring substant goods.

· Stocking also helps an organization improve its accuracy of purchasing and stock ordering process. Stocking involves the calculation of the consumption rate and factoring in the lead time. After that, an individual decides the volume of stock that is of the optimum level for a given period. This kind of planning gives the procurement unit the time to plan and conduct an effective procurement process.

Importance of placing timely orders

The ordering process represents acquiring goods and services to replenish the stock levels of an organization and avoid stockouts.

· The importance of accurate and timely orders for a health organization is that it improves the organization's efficiency in the provision of its services (Bure et al., 2017). Medicines form the most significant component of the stocks in a medical setting. Therefore, having the proper supply of medication at the right time ensures the doctors perform their duties effectively.

· In addition, placing timely orders ensures that an organization has ample time to conduct due diligence in the procuring process and avoid resources and time wastage.

How to avoid last minute Stock-0uts