Running head TOTAL COST OF OWNERSHIP REPORT .docx

Running head: TOTAL COST OF OWNERSHIP REPORT
1
TOTAL COST OF OWNERSHIP REPORT
5
Total Cost of Ownership
Zachary T. Trigger
UMCG
Purchasing Management
Professor James Swaim
2/8/2020
Balanced scorecard
A balanced scorecard is a concept used by managers to analyze
their business using four different perspectives. It helps to
provide a customer’s perspective, the organization’s internal
perspective, the innovation and learning perspective and the
financial perspective. The advantage for this measure is that it
reduces the data overload by minimizing the number of required
measures.
The mission statement of the organization is used to determine
the customer perspective. This is helps to frame how the

customer views the organization. The mission for the
organization is to become a leader in delivering products used
in laboratory testing. The concerns of the customer deal with
time, quality, cost and performance and service. The company
has been able to deliver orders made by customers within a
short lead time except for few instances when suppliers had
failed to deliver the raw materials within the stipulated time.
The quality of the products it delivers has been undisputed. The
cost of the products is also competitive in the market when
compared to those of the competitors. This has helped the
organization to gain a substantial market base. Convenience has
been created for the customers by carrying out delivery to their
preferred destination. Under this goals and achievements, it can
be concluded that the organization is preferred by many
customers (Kaplan & Norton, 1992).
Company based measures are important as they dictate how the
organization meets the customer’s needs. Quality is the main
concern for the organization’s customers and therefore,
measures should be put in place to ensure that the final products
are of good quality. This can be achieved through the selection
of the best suppliers based on the quality of their raw materials
rather than the price. This was achieved in the process of
supplier selection and the continuous evaluation of the suppliers
to ensure that they maintain the quality. The processes
undertaken to produce the products used in laboratory settings
are also meticulously monitored and improvements made over
time. This means that the quality increases with time and this
ensures that the internal metric of quality is achieved (Kaplan &
Norton, 1992).
Innovation and learning is part of the culture within the
organization. There is a research and development department
within the organization whose sole purpose is to carry out
research and come up with new and improved products. These
are aimed at meeting the ever changing needs of the consumer.
The financial perspective of the organization is also promising
since the profitability has increased. The company has

experienced growth and this has placed it in a better position to
bargain for lower supply costs. It has been able to enjoy the
benefits of economies of scale (Kaplan & Norton, 1992).
Total cost of ownership
Total cost of ownership (TCO) is different from the
procurement approach because it does not account for the
purchase price only. Other costs associated with the supply
include storage, taxes, shipping, insurance and disposal. The
raw materials that are purchased some of them are perishable
such as the hearts of pigs. Although there might be an
advantage in buying bulk, it is advisable to buy in small
quantities that are required in the manufacturing process. This
prevents any losses from being incurred in the form of
deterioration when the raw material is purchased in large
quantities (Plues, 2012).
There are several other factors to be considered in TCO model.
First is the supply partner development costs. There are costs
associated with the development of the partnership and this
should be proportional to the value that the supplier brings to
the organization. An example is for the turkey legs; it is
advisable to look for a supplier that will supply the muscles
only rather than the whole leg for the organization to obtain
muscle from it. This reduces the manufacturing costs associated
with the product. The location of the supplier is also important
as it determines the shipping cost and time. Although a supplier
may have quality products at a lower price, their location may
disqualify them because the shipping cost and time taken to
transport them ultimately makes the product expensive.
Therefore, it is advisable to source for raw materials in a nearby
location (Lancione, 2018).
There are various costs associated with the quality of the raw
materials. Low quality raw materials lead to low quality final
products and disappointment by the customer. There are also
costs associated with returns when the quality is not good. Low
quality also presents safety issues. It is therefore advisable to
choose high quality suppliers to avoid the costs associated with

low quality. The payment terms should also be clearly outlined.
Payment to the suppliers should be done after delivery and not
before as this would hurt the cash flow and places the
organization at risk. The procurement department should also
protect the organization from potential cost fluctuations by
choosing to purchase a position in the foreign currency for the
price at that point in time (Lancione, 2018).
References
Kaplan, R., & Norton, D. (1992). The Balanced Scorecard—
Measures that Drive Performance. Retrieved 7 February 2020,
from https://hbr.org/1992/01/the-balanced-scorecard-measures-
that-drive-performance-2
Lancione, T. (2018). 6 TCO Considerations When Choosing a
Supply Partner | IndustryStar
Solution
s. Retrieved 7 February 2020, from
https://www.industrystarsolutions.com/blog/2018/07/6-total-
cost-ownership-considerations/
Pluess, J. (2012). What Total Cost of Ownership Offers
Sustainable Procurement | Blog | BSR. Retrieved 7 February
2020, from https://www.bsr.org/en/our-insights/blog-view/what-
total-cost-of-ownership-offers-sustainable-procurement

IHP 525 Milestone Three Table
For this milestone, in order to explore your health question you
are investigating, you need to plan what descriptive statistics
and statistical test you will need to run, as well as what graph
you will need to create.
Step 1: Complete the table below in which you will propose the
calculations and graph(s) you will need to perform to answer
the health question you are investigating.
Question:
Answer:
What is your health (research) question?
What is the corresponding null and alternative hypotheses?
List the descriptive statistics you will compute, using which
variable(s), to help answer your health question.
What is the name of the statistical test that you will use to test
your hypothesis and answer your health question?
What is the formula for your chosen statistical test?

Why is the statistical test you chose appropriate to answer your
health question? Be sure to be clear on how the two variables
you described in Milestone Two are used to complete this test.
Which graph(s) (histogram, stem and leaf, boxplot, bar graph,
scatterplot) will you use to visualize the answer to your health
question? Be specific and include which variables will be used
and if the graph will be created for different subgroups of
subjects.
Step 2: Provide a 1-2 paragraph explanation below as to why
you chose the calculations outlined in the table above to explore
your health question. Describe what statistics you will compute
in order to answer your chosen health (research) question. Be
sure to discuss any graphs that you will compute and what
information they will provide to help you answer your health
question.
Running head: SUPPLIER SELECTION REPORT
1
SUPPLIER SELECTION REPORT

5
Supplier Selection Report
Zachary T. Trigger
UMCG
Purchasing Management
Professor James Swaim
February 2, 2020
The criteria for the selection of suppliers has significantly
changed over the years. In the past, price was utilized as the
primary criteria for the selection of suppliers together with
location and preferences. However, there has been a greater
emphasis on food safety and quality hence the need to improve

on the quality of raw materials supplied. Choosing the right
suppliers can help an organization to meet and supersede the set
regulatory standards while increasing consumer demand and
building the brand reputation. The supplier that is chosen has to
be able to deliver quality and safe ingredients which will
translate to quality and safe end products for the consumer
(Eldridge, 2012).
Identifying the appropriate supplier is a costly affair but has
significant results if done in the correct manner. The opinions
of the stakeholders are sought to determine the appropriate
criteria to follow in selecting a supplier. Some of the
stakeholders include members of the research and development,
processing, quality assurance, marketing and purchasing among
others. After the identification of the appropriate criteria
potential suppliers are identified and their capabilities and
pricing is compared. This stage involves working with the
potential suppliers and maintaining open communication where
the manufacturer explains to the supplier the manufacturing
process. While cost is a significant driver, value is paramount
and it should be key in selecting the appropriate supplier. Some
of the factors which contribute towards value include delivery
commitments, responsiveness and reliability, hard and soft
resource savings and customer service (Eldridge, 2012).
The raw materials that are being sought are highly perishable
and one criteria for the supplier is that it should be able to reach

the company in a fresh state. This should be one of the factors
to look for when sourcing for the supplier. Because of the
sensitive nature of the raw materials that are required, it is
paramount that the supplier is able to assure of the quality of
the raw materials they will be supplying. For example, the
supplier for hearts from pigs should have a pig farm rather than
outsourcing from another farm. This way, they are able to raise
the pigs to standard and consequently they will have good
quantity hearts to serve the purpose aimed at by the company.
This is carried out on all of the other required raw materials.
Before signing the contact, there is need to carry out an audit on
the suppliers to determine whether or not they have the capacity
to deliver. The audit is carried out to enable the determination
of whether the supplier is compliant or has some significant
compliance or quality system failures. These shortcomings have
a significant impact on the supplier’s capability to produce top
quality products. This procedure is carried out on the best
suited supplier since it is a costly process and it aims at
protecting the manufacturers from contracting a supplier that
may be good in the books but this does not match the actual
situation of the company. The audit also aims at helping the
company to understand the weaknesses and strengths of the
supplier before the relationship is made official. Therefore, by
carrying out an audit of the suppliers, the company is able to
determine the capability of the supplier to meet the company’s

requirements (Assemblymag, 2001).
Evaluating the performance of a supplier is important to grade
them and determine whether or not the partnership will
continue. Evaluation can be carried out through a self-
assessment questionnaire by the suppliers. This helps the
supplier to identify any existing gaps ad take the appropriate
measures towards covering them. It also helps the company to
understand how the supplier understands its operations and
whether or not they are willing to make improvements on
existing discrepancies. The company should also set up
appropriate metrics with which the measurement of performance
can be carried out. Some of the metrics which can be used
include lots that are rejected, documentation errors and perfect
shipments among many others. The metrics allows for the
categorization of the supplier as either full partner, associate
partner, high risk or incapable. A full partner is a supplier that
has been able to meet all the company’s expectations and can be
trusted to supply quality raw materials to the manufacturer. An
associate partner is a supplier that falls short of the expectations
and needs to put in more effort so as to attain the status of a full
partner. High risk supplier is utilized for current production but
it is advised not to award them with future business. An
incapable supplier does not meet the needs of the manufacturer
and hence they should be let go as soon as possible. These
categorizations help the company to know which supplier they

need to replace and which one they need to retain. It plays a
significant role in the continuous process of assuring quality in
the raw materials that they are supplied with (Assemblymag,
2001).
Establishing long term supplier relationships has many
advantages on the company. It leads to a reduction is costs since
there is a significant amount of resources that is associated with
searching for a supplier including months of determining the
appropriate one and setting up a relationship with them. With
long term suppliers, there is an increase in communication and
efficiency hence a smooth operation unlike in instances where
the supplier is regularly changed. With the long term
relationship, there is also room for continued improvement and
the supplier is able to better understand the needs of the
manufacturer and hence they are able to satisfy them better
(Figues, 2020). Long term suppliers are those that have been
able to achieve the metrics of full partnership and the two
entities have been able to establish a level of trust and by
working together, the company has been able to achieve and
supersede the required quality.
References
Assemblymag. (2001). Retrieved 2 February 2020, from
https://www.assemblymag.com/articles/82672-how-to-evaluate-

suppliers
Eldridge, B. (2012). Supplier Management: Six Steps to
Selecting the Right Supplier. Retrieved 2 February 2020, from
https://www.foodsafetymagazine.com/magazine-
archive1/augustseptember-2012/supplier-management-six-steps-
to-selecting-the-right-supplier/
Figues, R. (2020). Retrieved 2 February 2020, from
http://www.academia.edu/8304256/CHAPTER_4_QUALITY_IN
_CUSTOMER_SUPLLIER_RELATIONSHIPS
2/20/2020 Rubric Assessment - BMGT 375 6380 Purchasing
Management (2202) - UMGC Learning Management System
https://learn.umuc.edu/d2l/lms/competencies/rubric/rubrics_asse
ssment_results.d2l?ou=487048&evalObjectId=921357&evalObj
ectType=1&userId=173587&viewTypeId=3&rubricId=881966&
groupId=0… 1/5
Criteria Outstanding Superior Good Subst
Contract Type

Selected
Potential
Liability
Exposure
2 points
All types of relevant
contracts were discussed
thoroughly and selection
was logically reasoned
using insightful application
of the case study facts and
class materials. Rejection

of other contracts than the
one selected was
comprehensively discussed
and support with case
study facts and class
material.
(1.8-2.0)
1.7 points
All major types of relevant
contracts were discussed and
selection was logically reasoned
by applying the case study facts
and class materials. Rejection of

other contracts than the one
selected was underdeveloped as
to one or two types because
support with case study facts and
class material was minimal.
(1.60-1.799)
1.5 points
Comments generally identified
the major types of contracts
under consideration. Comments
reflect a satisfactory level of
analysis, synthesis, evaluation

and reasoning of the case
material and case study facts.
However, discussion of those
types rejected was too
general leaving the reasoning to
be underdeveloped.
(1.4-1.599)
1.3 p
Comm
minim
the ty
contr
to the

justif
selec
implie
analy
evalu
reaso
case
case
spars
demo
(1.2-1
3 points

Discussion identified
all potential legal liability
for the company. All points
were discussed thoroughly
and selection was logically
reasoned using insightful
application of the case
2.55 points
Discussion identified major
potential legal liability for the
company but one minor area was
missed and or one major area was
underdeveloped. Points discussed

were logically reasoned using a
good application of the case
study facts and class materials.
2.25 points
Discussion identified most major
potential legal liability for the
company but one or two major
points were missed and or
underdeveloped. Points discussed
were logically reasoned mostly
using a application of the case
study facts and class materials.

1.95
An at
to ref
satisf
analy
evalu
poten
liabili
comp

groupId=0… 2/5
Recommended
terms and
conditions for
the contract
are suggested
Created
study facts and class
materials.
(2.7-3.0)
(2.4-2.699) Comments tended to be
overbroad.

(2.1-2.399)
Howe
reaso
case
case
in mi
of the
used.
majo
liabili
missi
(1.8-2
2.25 points

Comments specifically
identify and
comprehensively explain
the terms and conditions
needed in the contract to
protect the
company. Conclusions
drawn reflected a highly
accomplished level of
analysis, synthesis,
evaluation and reasoning
of the case material and

case study facts resulting
in accurate, thorough, and
soundly reasoned
conclusions
(2.025-2.25)
1.91 points
Comments specifically identify
and explain the terms and
conditions that would most
benefit the company. Comments
demonstrated a good level of
analysis, synthesis, evaluation

and reasoning of the case
material and case study facts
resulting in mostly accurate
reasoned conclusions. One or
two terms while mentioned were
not developed as to why they
would benefit the company.
(1.8-2.024)
1.69 points
Comments identified and
explained most of the major
terms and conditions needed to
benefit the company. Justification

for the selection of the terms was
mostly reasoned from the case
material and case study facts
tended to be overbroad and
rarely discussed specifically why
the terms and conditions were
selected.
(1.575-1.799)
1.46
Comm
to ide
expla

cond
the u
mate
study
suppo
reaso
the c
minim
Justif
selec
implie
discu
may o

list of
cond
expla
(1.35
3 points 2.55 points 2.25 points 1.95
groupId=0… 3/5
detailed RFB
that includes

discussion of
the enzyme
mixing process
Attention to
Instructions
Writing
Formatting and
development of RFP was
correct and
comprehensively explained.
Mixture process was
detailed as to all four
materials. Each element

of the report defined the
conclusions drawn
reflecting a highly
accomplished level of
analysis, synthesis,
evaluation and reasoning
of the case material and
case study facts resulting
in accurate, thorough, and
soundly reasoned
conclusions
(2.7-3.0)

Formatting and development
of RFP reports was correct
and explained. Each element
of the report defined
the conclusions drawn reflecting
a good level of analysis,
synthesis, evaluation and
reasoning of the case material
and case study facts resulting in
accurate, and logically reasoned
conclusions. However,
development of the mixing
process was not fully explained

and or supported by class
material.
(2.4-2.699)
RFP report was created and all
elements were present.
Comments identified
elements but had 3-4 mistakes in
the discussion of the mixing
process. Comments reflect a
satisfactory level of analysis,
synthesis, evaluation and
reasoning of the case material

and case study facts. Discussion
was general as a result.
(2.1-2.399)
An at
made
RFP r
eleme
prese
Comm
some
eleme
in the
only w

suppo
eithe
unde
reaso
(1.8-2
2.25 points
Demonstrates exceptional
understanding of
requirements responding
completely to each aspect
of assignment including
minor aspects of the

assignment such as using
third person writing,
required use of course
readings, and assignment
format.
(2.025-2.25)
1.91 points
Demonstrates excellent
understanding of requirements;
missed one minor aspect of
assignment.
(1.8-2.024)

1.69 points
Demonstrates satisfactory
understanding of requirements;
missed a key element or two
minor aspects of assignment.
(1.575-1.799)
1.46
Fails
unde
requi
misse
eleme
mino

assig
(1.35
2 points 1.7 points 1.5 points 1.3 p
groupId=0… 4/5
Total / 15
Overall Score
Mechanics
Adherence to

APA Style (6th
ed.)
Strictly adheres to standard
usage rules of written
English, including but not
limited to capitalization,
punctuation, run-on
sentences, missing or extra
words, stylistic errors,
spelling and grammatical
errors. No errors found. No
contractions or jargon
used.

(1.8 - 2)
Excellently adheres to standard
usage of mechanics: conventions
of written English, including
capitalization, punctuation, and
spelling. One to three errors
found.
(1.6 - 1.799)
Satisfactorily adheres to standard
usage rules of mechanics:
conventions of English, including
capitalization, punctuation, and

spelling. Four to 10 errors found.
(1.4 - 1.599)
Minim
to sta
rules
conve
writte
includ
capita
punct
spelli
10 er
(1.2 -

0.5 points
No APA style or usage
errors; Proper citation of
source material is used
throughout paper;
Reference titles follow APA
with only the first word,
the first word after a colon
and proper nouns
capitalized.
(0.45 - 0.5)
0.425 points

Attempts in-text citations and
reference list but one or two APA
style errors noted or fails to use
APA citations when appropriate
1-2 times.
(0.40 - 0.44)
0.375 points
Attempts in-text citations and
reference lists; APA style errors
are noted throughout document;
Fails to use APA citations when
appropriate 3 times in document.
(0.35 - 0.39)

0.325
Attem
citati
refere
to us
when
5 tim
only
citati
refere
pape
APA

throu
docu
(0.30
groupId=0… 5/5
Close
Outstanding
13.5 points minimum
Superior
12 points minimum
Good

10.5 points minimum
Substandard
9 points minimum
Failure
0 points minimum
Assignment #3: Purchasing Organization Metrics Report
The resources provided are the only ones to be used.
Assignment must be written within the rubric. Assignment 1 &
2 have been attached to help with writing.
Moving forward with the work you’ve started with Assignment
1 and 2, discuss the various legal ramifications of buying and
using the five different types of materials you’ll need for your
new company. Specifically, discuss the type of contract you’ll
use, potential liability you might be exposed to, and the terms
and conditions that will most likely lead to a harmonious
relationship with your suppliers. Also, create a detailed RFP
that includes the corn leaf supplier taking over the processing of
this material into an enzyme that you can mix with to the other
four materials. Your paper should be two to three pages,
double-spaced, 12-point font, one-inch margins.

Required Formatting of Assignment #3:
The report should be double spaced, 12-point font, three pages
in length excluding the title page and reference page
Third person writing is required. Third person means that there
are no words such as “I, me, my, we, or us” (first person
writing), nor is there use of “you or your” (second person
writing). If uncertain how to write in the third person, view this
link:
http://www.quickanddirtytips.com/education/grammar/first-
second-and-third-person.
Contractions are not used in business writing, so you are
expected NOT to use contractions in writing this assignment.
Title page
Use headings to help organize the paper
Use APA formatting for in-text citations and reference page.
You are expected to paraphrase and not use quotes. Deductions
will be taken when quotes are used and found to be unnecessary.
The expectation is that you provide a robust use of the course
readings. No other books besides the course eBook can be used.
When using a source document, the expectation is that the
information is cited and referenced with a page or paragraph
number.
Resources:
https://www.youtube.com/watch?v=-JalXrvGDVM

https://www.legal500.com/assets/pages/gc/summer-
2016/procurement-and-legal-a-perfect-
storm.html#sthash.JcomAXrg.zkRCKlH7.dpbs
https://www.slideshare.net/myzamri01/the-legal-aspect-of-
purchasing
https://www.ibm.com/support/knowledgecenter/en/SS5RRF_7.6.
5/com.ibm.mavmpr.doc/procure/c_purch_rec.html
https://www.sba.gov/sites/default/files/files/PARTICIPANT_G
UIDE_RECORD_KEEPING.pdf
https://www.nextlevelpurchasing.com/articles/procurement-
reports.php
https://www.nextlevelpurchasing.com/articles/procurement-
report.php
http://purchasing.houstontx.gov/bids/Q23472/Q23472%20Exhib
it%20B%20%20-%20Reporting%20Requirements.pdf
https://www.youtube.com/watch?v=cfyfdZhqX7c
https://tenderspage.com/everything-need-know-rfp-process/
https://www.youtube.com/watch?v=Ch9LPTtIwaI
https://www.nolo.com/legal-encyclopedia/the-ucc-contracts-the-
sale-goods.html
https://www.clarkewillmott.com/news/battle-of-forms-whose-
terms-apply-to-the-contract/
https://www.youtube.com/watch?v=NDXdHEqeOZk

Running head TOTAL COST OF OWNERSHIP REPORT .docx

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