Managing and Controlling Public Sector Supply Chains

Ambe, 2009). For example, countries such as the UK, US and Canada have for long employed SCM in the management of their procurement and logistics (OCG, 2005) as well as South Africa (Ambe, 2009) among others.Despite the interest and employment of SCM in public institutions, Humphries and Wilding (2004) assert that much has not been done compared to the private sector.According to Korosec (2003), majority of SCM literature that does exist focuses primarily on private sector transactions or on international governments owing to the fact that SCM has been used in both of these arenas for almost two decades.Notwithstanding this, many professional government organizations have indicated that SCM could hold great promise in enhancing public procurement systems.However, Essig & Dorobek (2006:1) argue that the management of public supply chain raises various research questions that need to be answered.The chapter explore the concept of supply chain management in the public sector.The chapter utilises a case study of the SCM in the South African public sector to differentiate between public versus private sectors supply chains.It presents the critical components, features and importance of public sector supply chains.Furthermore, the chapter portray the need for supply chain improvement and the employment of performance measures in the public sector.A balanced scorecard as a supply chain performance indicator is suggested for application to the public sector supply chain.The chapter contributes to literature on the application of public sector supply chains. www.intechopen.comSupply Chain Management 74 Supply chain management in the public sectorSupply chain management (SCM) is a term used in business literature to refer to the control o f m a t e r i a l s , i n f o r m a t i o n , a n d f i n a n c e s a s t h e y m o v e i n a p r o c e s s f r o m s u p p l i e r t o manufacturer to wholesaler to retailer to consumer.The term supply chain is inspired by the product flow that should be delivered to citizens or businesses by passes through several organizations.According to the Council of Supply Chain Management Professionals (CSCMP, 2007), "Supply chain management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities.It also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers, and customers."In a functional sense, this focus on activities and relationships implies logistics, marketing, purchasing/supply, and production/operations are involved in SCM.In essence, SCM integrates supply and demand management within and across organizations.A supply chain consists of all parties involved directly or indirectly in fulfilling a customer request.It includes all functions involved in receiving and filling a customer request.These functions include but are not limited to new product selection, procurement, marketing, operations, distribution, finance, and customer service.A supply chain, as opposed to supply chain management, is a set of organizations directly linked by one or more of the upstream and downstream flows of products, services, finances, and information from a source to a customer.Managing a supply chain is 'supply chain management ' (Mentzer et al., 2001).Each stage in a supply chain is connected through the flow of products, information, and funds.In the public sector, SCM is concerned with the "co-ordination of all parties involved in delivering the combination of inputs, outputs or outcomes that will meet a specified public sector requirement."These parties include external suppliers, partner organisations, and internal corporate service units both inside and outside the organisation.The supply chain may be inbound into the public sector.That is an operational requirement for internal customers for example, or it may be outbound from the public sector.That is in place to deliver wider organisational objectives to provide services for delivery to citizens, or a combination of both.Supply chains in the public sector addresses different focus areas.The focus of SCM can differ from government sector-to-sector and SCM can differ from industry sector-to-sector.An example of a government sector to sector focus area could be in the health sector, where the focus may be more on logistics and the effective movement of goods and services in and out of hospitals whereas SCM in the education sector may focus on streamlining the chain through which teaching materials are delivered to students.The shape of the supply chain and the supply chain management processes employed will vary considerably depending on a range of different considerations (OGC, 2005).Public sector SCM offers a reference framework for the composition of public sector supply chains and multilevel networks (Migiro & Ambe, 2008).Actors in public sector supply chain comprise (1) private firms which receive orders from public sector agents, (2) accounting officers and (3) policy-makers.The SCM in the public sector not only concentrates on the question, which institutions cooperate in goods and services, but also how these enterprises are involved with enterprises operating at other levels.Thus, analyses of intra-networkrelationships as well as analyses of inter-network-relationship are essentially necessary elements of the concept.www.intechopen.

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