ABSTRACT
Supply Management is the process of identifying, acquiring, and managing the products or services needed to operate a company/business. Traditionally, this would have been called procurement or possibly strategic sourcing, but the role and responsibilities have evolved over the years. And the purpose of supply-management practices and procedures is to keep supply costs stable and use resources effectively to increase the profits and efficiency of the business. The Kraljic-type matrix is divided into four quadrants along two axes; the y-axis represents business impact and the x-axis represents supply risk, and the quadrants are then positioned based on each quadrant’s relationship to business impact and supply risks. The supply-management strategy for Common items should be based on the objective of minimizing the cost of acquisition. The supply-management strategy for Constrained items should be based on the objective of minimizing supply risk. Constrained commodities, though of low value, consume disproportionate supply-management resources because of their limited availability or immature technology.
