Thanks to this new online bidding system, procurement decisions that took months earlier can now be arrived at within an hour. For its procurement process, the company uses an electronic tool called Ariba, which not only replaces the paper work but also eliminates the chances of misuse of purchase cards and other frauds. This automated ordering process reduced the use of purchasing cards from around $18 million in 2001 to less than $2 million in 2003. [Susan Avery] These savings in spendings on indirect materials and services is just one area of the supply chain where automation and optimization have proved effective.

The center point of Cessna's new initiatives aimed at rationalizing the Supplier chain management system, is the MPD process. The Maturity Path Development Process (MPD) is a process where Cessna officials sit together with their Suppliers on a regular basis and review the expectations and the quality and...
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