Ibm (china) Procurement Center Global Purchasing Strategy

This paper followed IBM China procurement's development as a key path. Discussed how the TNC transfers their global procurement and supplier management model strategically to cut down the global operations cost improve market response speed, in order to maintain a sustainable competition advantages. At the beginning of this paper, it introduced some of the theories on TNC's global procurement strategies, defined relevant definitions of global procurement, analyzed few common organizational structures and made a conclusion on TNC's global procurement business models. Later on this paper, it briefly introduced the IBM self-renovation since 1990's. Based on this background, the IBM (China)'s development and procurement organizational structure's reform has been sketched as well. It draw more attention on the issues of the IBM (China) has met on the beginning of her started. Based on these issues, in chapter 4, it discussed several points on IBM (China)'s innovation, such as the global procurement's organizational structures changing, Procurement Process reforming, supply-chain's structure, Procurement staff performance evaluation, global procurement system. At the final of this paper, it pointed out few safe-guard methods to ensure all above changing will be effectively carried on, like improve corporate governance model, Leadership style and culture, staff training, IT technology and more effective contract management.In the past time, the traditional procurement was followed the customer demands, though the ERP system to obtain the relevant materials and service's demands, then find the appropriate suppliers for procurement. If the current suppliers cannot provide a certain material(s) or service(s), company must re-locate a new supplier(s). Obviously, this produce really reduced the efficiency of procurement. Through the studies, IBM (China) has successfully introduced strategies into procurement processing. Understanding the customer demanding, analyzed technology development and procurement market, using a reasonable procurement price as a guideline to chose the suppliers. By putting suppliers in to IBM (China)'s global database in advance, completed the suppliers'first select, registration and determine do the supplier full fill the IBM's requirement or not. Followed by such procedural, the advantage is once the demands has been met, she could pick up a supplier(s) from this database and start the price negations, issue the contact, procurement order, etc immediately. Meanwhile, thanks for the modern IT technology, the internet and digital data exchange technology has been widely, IBM (China) could start e-procurement very easily. This enhanced communication between the supplier and order maker, improved the procurement's processing, increased IBM global supply chain's response speed. Furthermore, it enhanced IBM's core—competitiveness as well. Through the global procurement, IBM (China) has established strategy partner relations with suppliers from all-around the world, this was also provided a huge resources to support IBM's strategic restructuring.To study and research IBM (China) procurement's development & reforming and strategic restructuring, will provide a good case study for many similar company(s). By learning it, they could develop their own procurement and supplier management, to enhance the company's competency and be ready for the globalization.