Faster | Cheaper | Better PTC A Fictional Rail Network, in Figures: 124 km network with 78 stations 9 lines, 4 underground 200 million passenger journeys per year Daily ridership: 547,935 Average speed: 30.7 km/h Top speed: 72 km/h Total annual distance moved by trains: 132 million km Background The Passenger Transport Corporation (PTC) is a large public utility in a country far away from here. It is responsible for operating an integrated metropolitan railway system, partially on underground permanent way (track). The system was designed and constructed by a consortium of European companies, employing the services of local contractors. The network took just under 10 years to construct. The project was completed and the final phase commissioned about three years ago. Procurement at PTC The Passenger Transport Corporation has a centralised purchasing department, with responsibility divided into four main product groups along the following lines: Group A Locomotives and rolling stock Group B Permanent way and signalling Group C Facilities (stations, offices and other buildings) Group D Consumables (stationery, office equipment, uniforms, cleaning materials, etc.) It was the original intention that a standard system of stock control and provisioning should be adopted across each group, and that activities would be coordinated by the purchasing director alongside her various other responsibilities. In the event, things have not turned out to be as simple as were anticipated. It has been found that each of the groups has its own particular provisioning problems, and this has necessitated different approaches to acquisition in each of the main product groups.

Task

1. Read the above case study and consider your answers to each of the following questions:

What are the particular problems associated with procurement for each of the groups A-D?

If seeking to reduce the complexity of the procurement arrangements, what would you do? Indicate more appropriate provisioning approaches for each group.

What methodology would be suitable in rationalising the procurement arrangements? Can you provide examples of how procurement arrangements might look when done better?

What else might you do to improve the procurement function at PTC?

2. Post your answers in the discussion forum. Aim to write 250 words.

3. Comment on the answers given by another student, if your own viewpoint differs.