PROJECT PROCUREMENT

CASE STUDY (Procurement Mistakes)

The difficulties of procuring services as a Fortune 500 company

When youre engaged with the management of a business, the tasks associated with procuring reliable services come full with their share of challenges, and this is true no matter how large the organization is that you are working for. With that acknowledgment out of the way, it should come as no surprise that the tasks associated with procuring services for a Fortune 500 company are fraught with potential hurdles. Even more haunting is the potential for procurement mistakes to resonate throughout such vast operations, so every ounce of caution should be exercised before any decisions are made.

For starters, to be ranked amongst the Fortune 500, regardless of position on the list, means that a company is both undeniably massive and an unqualified success. In 2019, the occupant of position number 500 on the list, the venerable Levi Strauss, accumulated more than $5.5 billion in total revenue. In the process, Levi Strauss beat out the 501st company - Avon Products - by only $4 million to earn its spot on the cherished grouping of gargantuan money-makers. To further put that into perspective, modern corporations cant even sniff distinction as a Fortune 500 company without amassing revenues that exceed the GDP of nearly 20 percent of the worlds countries.

Collectively, Fortune 500 companies account for two-thirds of the U.S. GDP, which amounts to $13.7 trillion in revenues to go along with $1.1 trillion in profits and $22.6 trillion in overall market value. They also employ 28.7 million people worldwide, which means that the composition of workers employed by Fortune 500 companies, if lumped together as a single nation, would rank as one of the 50 largest countries in the world in terms of overall population.

QUESTION 1 (25 Marks)

1.5 Even more haunting is the potential for procurement mistakes to resonate throughout such vast operations, so every ounce of caution should be exercised before any decisions are made This statement shows mistakes may be committed anywhere within the procurement process. Discuss how you would minimise such mistakes caused by the misunderstanding by the seller (outside organisation). (25 Marks)

*Please answer carefully and critically, this is a 25 Marks Question, use information from the CASE STUDY*

Question is based on a procurement mistakes and how they can be MINIMISED, please answer this specific question.