The Sourcing and Procurement Strategy of Sanofi- Aventis

Résumé du document

Sanofi Aventis, a multi-national pharmaceutical company, uses purchasing structures and procedures that aim to cover all activities and all types of purchasing. The structure is based on placing the purchasing responsibility on entities and business units, under the supervision of a central team. There is a group wide procedure which must be closely followed by all entities and business units. Each unit may have its own local rules and procedures to abide by provided they comply with the group procedure. There are specific roles from purchase request to management decision. The role of the purchasing department is to assist the units making the request and to quantify their needs. From specification to supplier selection, the role of the purchasing department is to identify and select potential suppliers. Tendering and negotiations are led by the buyer and should enable a final decision to be made. Regarding contractual commitment to payment of invoice, the role of the purchasing department is to formalize the contractual relationship by preparing and signing purchase contracts and orders. Group level policies such as the Social Charter were distributed to all employees in 20 languages in order to outline the principles that form the common base of human resources within the Group.

Extraits

[...] The total amount of employees adds up to 99,495. Organization of the Purchasing Department at Sanofi-Aventis The role of the Purchasing Department: Sanofi Aventis uses purchasing Structures and Procedures that aim to cover all activities and all types of purchasing The structure is based on placing the purchasing responsibility on entities and business units, under the supervision of a central team. There is a group procedure which must be closely followed by all entities and business units. Each unit may have its own local rules and procedures to abide by providing what they comply with the group's procedure. [...]

[...] Besides this, the ever increasing counterfeiting issue is threatening the entire pharmaceutical sector. Finally, other aspects like the alternative medicine or the fear of drugs and hospitals are smaller but still are important threats for the sector. Also, the current financial crisis has posed several problems including micro features such as the dismissal of over 700 medical representatives and macro features such as the reducing governmental budget for health care Squares Discussion of the 9 Squares Square 2 Market Development- In Europe, there is no direct way for consumer advertising. [...]

[...] Sanofi-Aventis needs to keep educating people who are involved in maintaining high standards of corporate discipline, such as purchase managers, suppliers, to make SPP system sustainable and developed. III. Seiri (Sorting Out)—the 3rd important factor. It concerns the storage issue of the supply chain. Sanofi-Aventis needs probably a warehouse to store its raw production materials and office equipments, etc. IV. Seiton (Systematic Arrangement)—the 4th important factor. [...]

[...] Another problem for Sanofi Aventis is the increase in parallel trade. This occurs when a drug sold abroad under the same brand name as in the domestic market is re-imported into that domestic market and sold at a lower price by traders on the internet or by mail order. Counterfeit drugs make up, on average 10% of the worldwide market. In countries with good regulatory control, counterfeit drugs only represent of the market but this has been found to rise up to 30% in some countries of drugs sold over the internet are counterfeit Strategies for competition In regard to the above information, here are some possible Attack and Defense Strategies for Sanofi-Aventis The principal strategy for pharmaceutical companies is to be the first to produce a certain type of drug. [...]

[...] This is a defensive attack and could be seen as a preventative. Counterattacking can only take place after 20 years when a company can copy the exact same drug. A company producing a drug against the same disease as its competitor can be seen as a direct attack, however the company could look at other markets leaders, for example Pfizer, to see what type of drugs it is not producing and then focus on research to create a product to fill this gap before Pfizer does. [...]