Supply Chain Management

Purchasing Overview
2014
Celestica Confidential

Definition
The Celestica Supply Chain Management (SCM)
organization, including all purchasing managers and buyers,
is responsible for achieving the best overall value, including
supplier selection based on total cost of ownership.
This includes such elements as price, delivery and quality,
flexibility and responsiveness, asset management and
low SCM overhead when acquiring or contracting for
goods, services, and intellectual property assets.

Purchasing organizational chart

Tamas Szontag
Site SCM Manager

TBC
Site Purchasing
Manager

Ciprian Campan
IBM, E/// & GE
Purchasing Team
Leader

Dan Nica
BSkyB & Amino
Purchasing Team
Leader

Gabriela Jurjea
EMC, Diebold &
Smart
Purchasing Team
Leader

Razvan Ilinca
Landis + Gyr, Siemens

NPI & Flexible

Buyers

Mihaela Druga
Buyer - IBM

Anca Buzle
Buyer BSkyB

Nicoleta Cristie
Buyer - EMC

Adina Maria Tap

Buyer L+G

Andrienne
Szvedovicz
Buyer - SMI, LS, NPI
& Proto

Kinga Hendrich
Buyer - IBM

Adrian Mircea Popa

Buyer BSkyB

Oana Stoica
Buyer - Diebold

Dan Sav
Buyer Siemens
Medical

Laszlo Koteles
Buyer NPI & Proto

Ciprian Malan
Buyer - EMC

Ioana Florina Lascu

Buyer Siemens
Medical

Cristina Fechete
Flex Buyer

Alex Major
Buyer Siemens
Medical

Roxana Lup
Flex Buyer

Andrea Emili
Buyer - IBM

Tunde Renata Vincze

Buyer - IBM

Alin Razvan Tarb

Buyer - IBM

Octavian Spatariu
Buyer - GE

Felicia Brisan
Buyer GE

Dan-Sebastian Oprea
Buyer Ericsson

Samuel Boldizsar
Buyer Ericsson

Akos Moldovan
Buyer BSkyB

Dorin Mihis
Buyer Juniper

Functions in Purchasing
Name of the Function

Role

Not in role

Buyer

Day to day production

supply, Inventory resp.

Planning the production

supply

NPI Buyer

New projects supply of

materials

Day to day production

supply

Team Leader

Overview, Support,
Escalation, HR related
issues, Inventory resp.

Day to day production

supply

Purchasing Manager

Overview, Support,
Escalation, HR related
issues, Inventory resp.

Segregation of Duties
No individual may have responsibility for more than one of the
following SCM related activities:
Definition of requirements (i.e. planning).
Selection of suppliers and determination of price, terms and conditions
(i.e. Commodity Management).
Execution of purchase orders (i.e. Buyer)
Confirmation of the receipt of products or services (i.e. receiving).
Processing of invoices for payment (i.e. Accounts Payable).

Refer to the Business Rules within Compliance Calibrator of

SAP.

Negotiation
Negotiation is required as part of all Celestica
purchases.
Negotiation must not be limited to price alone, and
should include all terms and conditions relative to total
cost such as quality, lead time, flexibility, payment terms,
and warranties.
Negotiation must continue not stop after receipt of a
quote: the SCM Commodity Manager or the SCM
Indirect Buyer should negotiate further with any one or
all of the potential suppliers.

Why do we need buyers?

Segregation of duties
Somebody needs to communicate with the suppliers
after all
Pull In/ Push out management
Issue MRP Forecasts and Purchase Orders to the
Supplier as required . Release windows are dependent
on procurement method selected
Communicate Supply Issues to the responsible Planner
in a timely manner

Why do we need NPI Buyers?

They need to focus on several projects at
the same time
New BOM RFQ for the NPI build
Responsible for the material budget of the
build
One of the few cases he/she has power of
negotiation (as a buyer)

Why do we need Team leaders?

Segregation of duties
Escalation point for all issues of the team
Single point of contact for BU (CFT)
Enclosed team management (close view
over cross CFT teams)
Focus on 50% technical skills, 50%
management skills

Why do we need Purchasing

Manager?
Segregation of duties
Escalation point for all plant customer
activity
Purchasing KPI ownership
HR related issues
Headcount allocation (for example)
KPI alignment to PBP

Flow of information

MRP
OK

Transform
PRs into
POs

PO follows
release
process

Pull in
orders

Send pull in
request

Increase
or
decrease

Transform
PO into
order

Sent order
to Supplier

Confirm
or not
accept
Push out
orders

Send push
out request

Supplier
confirms
order

Input data
into SAP
Escalate to
superior

Ordering
A Celestica approved purchasing document (i.e., Purchase
Order, Scheduling Agreement, pull schedule, etc) must
only be prepared from fully approved purchase
requisitions, system generated MRP requirements or
ASCA-approved Lean replenishment signals (i.e., Kanban
signals).
Copies of the purchasing document must be sent to the
supplier. A purchasing document must be used to cover
any and all types of purchases regardless of the dollar
amount.

Focus on:
Date of delivery
Volume MOQ / PF(PU)
Pull in request / Push out request
Invoice referrals Discrepancies between the
invoice and Celestica owned information
Incoming Holding Area referrals discrepancies
between orders and physical / invoice / delivery
note information
Dual source allocation

Escalations Red Alert Team

Buyers are regularly checking the status of all their open orders.
Buyers are also in regular contact with the supplier to make sure that the material will
be delivered according to required delivery date.
In case of expected or actual material shortage the Red Alert process is used.
Red Alert is the tool to escalate problems with on-time material delivery to the Supply
Chain Manager responsible for the Red Alert escalation who will help the buyer to
work with the supplier and to improve the delivery date.
Buyer will fill Red Alert case with the following information:
PN
Material description
PO number
History of PO (date when raised, if accepted by the supplier)
T&C information what is the standard lead-time
Root cause on the shortage
Description of all taken actions
Date of start
11.04.2013
11.7.2013
11.7.2013
11.8.2013

Escalation step
Purch Manager
SLM Team
SLM Team
SLM Team

Issue
request
Pull In
Push out
Push out
Pull In

CLS PN
CGGP.18.4.D.02
090-000-218EDS
090-000-215EDS
TC6320K6-G

Vendor Name
Tahogals
Arrow US
Arrow US
SUPERTEX INC.

QTY

Customer Qty x Board

50 Siemens OBU
20 EMC
10 EMC
GE
NA

Qty
affected

1
1
1

50
20
10
NA

Unit Average Price $ Total Revenue Pushout inside

(profit Center)
$
the quarter
140
1262
1257

7000
25240 Yes
12570 Yes

Pushout outside the

Status Root cause
quarter
no
no

Closed
Closed
Closed
Closed

Supplier
Customer
Customer
Supplier

SLM team How to?

Escalation Path

Site SCM
due diligence prior to escalation

SCM buyer identifies shortage,

completes internal/external due
diligence, and escalates to supplier
CSR / Global Account Manager
72 Hrs*
Site SCM leadership escalates the
shortage with the supplier at executive
level

Regional VP of Operations / Supply

Line Mgmt team escalates shortage to
Senior Executive team with supply base

Regional SLM
due diligence

Supply Line Management / Regional VP

Operations escalates to Celestica Global
Commodity Management

SLM/CM

- SCM Manager/Dir already engaged with

Supplier Management
- Checked and engaged with other approved
sources per AVL, for help
- Checked CLS world-wide inventories using
SCMDW
- Checked with manufacturers authorized
distributors
- Checked with CLS approved Disty/Brokers
Checked with Customer stock (if
appropriate)
Checked with Customer other EMS (if
appropriate)

Corporate Supply Mgt engages with

CM Directors and/or supplier executive
management

48 Hrs*

VP of Commodity Management/CPO
gets engaged, escalating the shortage
@ CEO Level within Supply Base
5 Days*

- Thorough understanding of issue, root cause,

and recovery plan
- Drive Executive level escalation with Supplier
and Internal escalation to CM Dir/VP/CPO
- Pursue supply opportunities through CLS
approved Disty/Brokers
- Balance existing supply within CLS sites (if
applicable)
- Customer/engineering support to qualify new
sources of supply (if applicable)
- Capture, monitor and publish shortages through
the Critical Shortage Report. to SCM/GCU/CM
Dir/VP/CPO

* If deemed by SCM VP as extremely critical due to impact on Celestica/Customer shipment/revenue, escalation will occur in parallel by
second level SCM Manager/Dir/VP and SLM Manager/CM Dir/VP/CPO within 24-48 hours.