Supply Chain Modeling

Purchasing Departments in all types of organizations are moving away from traditional single exchange transactions toward an emphasis on creating and maintaining long-term buyer-supplier relationships. As strategic partners, these relationships generate a supply chain that must be managed. They encompass all the activities associated with the flow of goods and services, as well as the flow of information. Information throughout the entire organization must simultaneously flow both up and down the supply chain to leverage strategic positioning and to improve efficiencies. For organizations to obtain sustainability in the future they must develop a strategy for creating, maintaining, and sustaining buyer/supplier relationships based on institutional requirements. As stated by a Vice-President of the Boston Consulting Group, "As the economy changes, as competition becomes more global, it is no longer company verses company but supply chain verses supply chain" (Henkoff, 1994:74).