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Supply chain management of ORASINVEST(BD) LTD & Procurement practices of the purchasing Department

Conducted by

1. Md. Asheque Kamal 2. Md. Shafiqul Islam

1038009 1038010

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Introduction :
For supply chain management, we chose to concentrate our study on Orasinvest (BD) Ltd. Since Orasinvest (BD) ltd is one of the leading service provider companies in the telecommunication business which is efficiently broadening the horizon, we thought it would be interesting to know about their practices and their strategies which they apply in their day to day activities in controlling the supply chain and also planning for the future demand and supply to reach the goals in time.

1.2 Objectives of the report:

After completing the analysis we will able to understand the following factors under the supply chain department of Orasinvest (BD) ltd. The roles and activities of supply chain management function. Greater efficiency. . Lower cost Enhance flexibility & agility Improve customer service Optimize the value chain.

1.3 Procurement in orasinvest Ltd

Procurement as a function in OrasInvest has gone through huge change over the past 5 years. We have seen the evolution of domestic and international procurement initiatives on direct materials, and indirect material, within OrasInvest and across our supplier base. There is now recognition by the Board and Senior Management of the significant contribution that Procurement can (and must) make in delivering smart cost management across the business. In support of this goal the following principles apply to the whole OrasInvest community and subsidiaries:

In procurement terms OrasInvest acts as one company, by using the defined common processes and platforms. The procurement decisions we make are taken in the best interests of OrasInvest as a whole. Decisions are influenced by the total cost of ownership, not just price. We will think and act globally and resolve domestic issues locally

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We will deliver absolute compliance to our strategies, processes, common platforms, agreements and policy. Ensure we have the right Procurement professionals at all levels.

1.4 Vision & Mission The vision for Procurement is:

Procurement, as a Strategic Sourcing process, will be responsible for releasing value of spend and building sustainable competitive advantage through the integration with suppliers and internal collaboration.

The mission for Procurement is:

To deploy leading edge Procurement People, Process & Policy to deliver maximum value on a sustainable basis.

1.5 Strategy
OrasInvests Procurement strategy is fully aligned with the corporate strategy of; growth, productivity, responsibility and winning organization, as shown below: Corporate Growth Procurement Innovation Strategy To provide integration of suppliers into innovations processes by application of the strategic sourcing process with a focus on securing, fast and responsive supply chain for speed to market and the development of new suppliers, where required. To ensure that all spend in OrasInvest (excluding salaries) has been through our Procurement process regardless of where it is negotiated (locally, regionally or globally). Our target is 100% spend coverage with 100% compliance to best leverage not only scale but appropriate management and use of resources. Responsibility Supplier Management To manage risk, by which we mean; security of supply, product stewardship i.e. integrity and quality, and working with ethical and responsible suppliers. Our strategy is to work with suppliers, whenever possible, who are of the scale that delivers in built contingency and if not then back up suppliers will be identified and approved. To evaluate suppliers business standards and performance, against OrasInvest requirements. These include quality, responsibility in supply chain management, and use of the benchmarking method to drive continuous improvement program with suppliers. The standards we expect from our suppliers are consistent with our corporate and social responsibility strategy and reporting. To have our function staffed by professional procurement people. These are people defined as practitioners of OrasInvest procurement process and corporate standards, to a high level of competency. The achievement of this aim will be through; benchmarking procurement skills and behaviors for recruitment


Smart cost management

Winning organization

Professional Procurement people

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selection of procurement specialists and development of current incumbents, education of OrasInvest procurement process, training at proficient and mastery levels in OrasInvest procurement process, An effective career development program allowing interchange between different line of businesses of procurement people, and rotation among subsidiaries. Clear succession planning for key procurement roles, by having all procurement reporting through procurement heads and managers to procurement director at the HQ.

2. Procurement Procedures: OrasInvests Procurement covers all aspects of the

procurement cycle, including the selection of the supplier, contract negotiations, order placement and payment

2.1. Preliminary Procedure

(a) Application Suppliers interested in entering into business relations with OrasInvest are to contact the Purchasing and Materials Department, and submit documents such as company profile, products brochure and technical information, so that an outline of range of products, sales points and price is well presented. (b) Supplier registration system OrasInvest procures Materials from registered suppliers. Therefore companies wishing to do business with OrasInvest are required to register following a procedure. OrasInvest is to survey the submitted forms of application and accompanying materials and to make an evaluation if requirements are complied with: management requirements such as operation scale and financial condition, and technical requirements such as technical skill, production system, quality control system, sales record, after-sales service system and delivery system. Furthermore, OrasInvest also considers in the process the applicant's degree of co-existence with the local community and the quantity of orders within the community in comparison with that of OrasInvest.

2.2 Final Procedure

(a) Request for procurement Request for procurement is first made by the department requiring the procurement, specifying quantities, dates and place of delivery of the Materials to the Purchasing and Materials Department. It then starts its procurement procedures. (b) Selection of a supplier qualified to submit a quotation OrasInvest procures materials, in principle, through competitive quotations among the suppliers it selects from the list of registered suppliers. In some specific cases, however, where the Material is to be manufactured under a particular patent or where strict compatibility with existing facilities is required, a specific supplier is selected to submit a quotation. OrasInvest makes Procurement Information on the main procurement items specifying Page 4 of 9

quantities and delivery dates. Depending upon the complexity of the requirement and the value of the commodity to be procured, the solicitation is issued as a Request for Quotation (RFQ) or as an Invitation to Bid (ITB) or as a Request for Proposal (RFP):

RFQ Request for Quotation

Is issued for the procurement of simple, uncomplicated goods and services of standard and firm specifications (off-the-shelf items). The evaluation of offers is based on price and other price related factors. The total estimated value is not exceeding US$ 25,000

ITB Invitation to Bid

Is issued for the procurement of goods and services of standard and firm specifications (offthe-shelf items) of a total estimated value in excess of US$ 25,000. The evaluation is based on price and price related factors.

RFP Request for Proposal

Is issued for the procurement of goods and services where the technical specifications or characteristics cannot be precisely determined, or are of a complicated / specialized technical nature which requires significant input form the supplier. By evaluating the proposals, the price may be only one of other considerations in award of the contract. (c) Submission and examination of specifications for quotation At first, OrasInvest shows specifications for purchasing Materials defining the contracting terms and conditions, and the specifications requested by OrasInvest. Next, OrasInvest asks suppliers to submit specifications for quotation according to specifications for purchase. The technical department of YONDEN requiring Materials examines whether submitted specifications for quotation meet the specifications requested by OrasInvest. They must be approved by this department. In addition, OrasInvest encourages the alternative quotation of VE Proposal in order to promote lowering procurement costs. This system is that suppliers propose another method for lowering procurement costs without losing functions requested originally. The supplier approved the proposal is selected as the priority supplier qualified to request for quotation by OrasInvest.

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(d) Integrated SCM application using ORACLE.

(f) Conclusion of contract When the negotiation is finalized, a contract in a form called purchased order prescribed by OrasInvest is drawn up. (g) Delivery, inspection and payment OrasInvest inspects Materials delivered to confirm that they meet the requirements of OrasInvest. Payment is made, in principle, as per payment terms.. (h) Other terms OrasInvest does not disclose to the third party any confidential information gained during the course of transaction without prior consent of the supplier. The supplier is required to do the same. OrasInvest may claim damages if Materials are delivered after the due date. Another common procurement procedure is to create a short list of pre-approved vendors for specific commodities. Vendors are added to the list through a bidding process that is conducted on a scheduled basis. This process is designed to be transparent and to provide the firm an opportunity to obtain discounts in price, to meet quality standards and to ensure timeliness of delivery. The risks for a company without proper procurement procedures are overspending, the failure to achieve good value and purchasing fraud. Many people who do not have any accounting or procurement training resent the steps involved in a purchasing request. These processes, however, are designed to save both time and money

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3.Procurement Services:

The purpose of a procurement service or department is the same, to obtain the best possible combination of price, service, and quality for the organization. Most procurement services focus on a specific aspect of procurement. Orasinvest an electronic procurement firm will have a complete software package that the firm will operate and manage on behalf of the client. Contracted service firms that offer procurement solutions are typically focused on providing expertise in the traditional procurement services. These areas include bid tendering, auction management, requests for proposal review, and contract negotiations.

4.Procurement Policies:

Whether at a small company or a large one, the chief procurement officer usually provides overall leadership to the purchasing team and ensures that procurement policies and procedures are followed. Typically, he also is constantly in search of better quality products and better prices. Programs of this type also make it possible to quickly track order fulfillment, delivery dates, and even review any procurement contracts that are currently in place. Whether the procurement policy involves the establishment of construction procurement procedures, or governs purchases made by a manufacturer or a charity, a solid policy will benefit the organization by keeping costs in line and clearly defining how purchases will be made.

5.Procurement Contracts:
Most procurement contracts are written agreements that specify each partys obligations in relation to the transaction. Generally, a procurement contract includes business provisions, detailed price lists, payment information, and other legal terms and conditions applicable to the transaction. This department is responsible for finding prospective vendors that can provide the services needed, compare their services with those of their competitors, and negotiate the best possible terms. Purchasing agents and managers often have the authority to enter into procurement contracts with vendors, as long as the contracts meet with company standards and regulations

6.Ethical Code
In all dealings with suppliers and potential suppliers, the Company will seek to preserve the highest standards of integrity, objectivity, fairness, efficiency, courtesy and professionalism and will look to suppliers to set similar standards. In applying this principle, those purchasing on behalf of the Company should follow the guidance set out below: o Declaration of Interest: There is a general duty to disclose at the earliest possible stage any financial or other interest that the person may have in any transaction, or proposed Page 7 of 9

transaction, between the Company and a third party. The disclosure of such interest should be made in writing to the Company Secretary. o Confidentiality and Accuracy of Information: The confidentiality or information received in the course of purchasing and procurement transactions should be respected and should never be used for personal gain; information given in the course of duty should be true and fair and never designed to mislead. o Competition: While bearing in mind the advantages to the Company of maintaining a continuing relationship with a Supplier, any arrangement which, in the long term, prevents the effective operation of fair competition should be avoided. o Business Gifts: Business gifts, other than items of very small intrinsic value such as business diaries, mugs or calendars, etc. should not be accepted. o Hospitality: Modest hospitality is an accepted courtesy of a business relationship. However, the recipient should not allow him/herself to reach a position whereby he/she might be deemed by others to have been influenced in making a business decision as a consequence of accepting such hospitality. o Inducement: No person acting on behalf of the Company may accept any inducement from any supplier or potential supplier or their agents. 6. Concussion Supply chain management ensures the movement of right product with a smarter, faster and efficient way to the right customer and the right time, place and price. The main objective of supply chain management is to create net value, building a competitive environment and synchronizing supply with demand .Under the supply chain management, one has to focus on distribution network, distribution strategy, information and inventory management.

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Thank you

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