Procurement activities are involved around goods and services of a company that needs in regular basis business operations of an organisation. Procurement activities include purchasing items that will help in development of products, receiving goods, negotiating terms and inspecting goods that are received by keeping record of it. As opined by You et al. (2020), procurement activities keep a track of all the steps in every process of business operation that helps in achieving goals of an organisation.
Automobile industry mainly focuses on procurement activities to get the right goods and supplies so that they can increase their development. As influenced by Leo et al. (2019), an automobile industry provides various ranges of designs, manufacturing of motor vehicles. This is 21st century and automobile industry is moving forward by providing electronic vehicles (EV). This industry has begun to provide EV that is made with sustainable energy. This industry is mainly involved in research and development of vehicles that will be sustainable for customer satisfaction.
Aston Martin Lagonda is a British luxury automobile company discovered in 1913 that is acknowledged as a stylish car brand. This company is located in England and has contracts with 55 countries for exportation of their manufactured cars. This company is aiming towards their sustainability in vehicles and supporting UN by going green with manufacture of their “Plug in hybrid electric sport car”.
(a) Identifying procurement activities in an organisation
Figure 1: Aspects of procurement process
(Sources: Influenced by Ghadgeet al. 2021)
Procurement activities are needed to evaluate any automobile industry’s inspection and negotiation with partners or investors for an automobile company. Aston Martin Lagonda has become one of the top luxury car brands by following effective procurement activities through efficient decisions of the leaders.
Good and services
A luxury car brand like Aston Martin Lagonda has implemented effective sustainability on their manufacturing of vehicles, which requires proper goods and services to provide a car. As opined by Ghadgeet al. (2021), the goods and services have to be socially and environmentally ethical for development of sustainable cars. This automobile company provides goods and services policy to ensure the investors that they are using sustainable materials to manufacture cars. The first step of any procurement process is to identify goods and services that are needed by this company. Identifying the right goods and services is essential for this automobile company’ success.
Purchase request
Purchases are handled in a tactical way to engage with internal customers and order business operations in supply chain. This automobile company requests the purchase of specific goods that are needed to manufacture vehicles to be sustainable and maintain safety procedures for the customers. The vendors are ordered with specified lists that are needed to manufacture efficient cars, which follow safety measures for customers. This company focuses on maintaining transparency by ensuring their values. This process helps to get an insight on vendor and company relationships. Thus, their relationship maintains the transparency towards purchase of goods that are needed to produce cars that are sustainable and safe for customers.
Negotiation
Leader of this company communicates with suppliers and investors to negotiate regarding terms with mutual decisions on alliance with a new company. As suggested by Senet al. (2020), alliances are needed to create good bonds between different organisations to have an insight on competition in the industry. Negotiation with supply chain and then following the procurement activities are done by Aston Martin Lagonda. This company has uplifted them, by committing on modern slavery act and purchase order on supply chains agave been coordinated with stakeholders of the firm. This process helps understanding bargaining and making a deal with different shareholder and partnership with
Receive and inspect delivered goods
Delivered goods are needed to be inspected and checked thoroughly to be sure about product quality and no damage done to the goods. Inspecting helps in looking at the future perspective to deliver products and making automobile organisations successful. Delivered goods have been inspected carefully and accurately by Aston Martin Lagonda to be sure about risk management that is going to help them overcome it. Based on the analysis of Zhang et al. (2020), payment needs to be ethically right and need to be conducted through application of Government guidelines so that there is no corruption in payment methods. This process is helpful for this company to clear out risks regarding product qualities that are going to be implemented on manufacturing cars. Ensuring payment is also another process that helps this automobile company to understand strict cost budgeting.
Records
Recording essential progress and exportations of goods has been implemented that has mainly made things easier for this automobile company. This process helps in keeping track of financial condition of this company to get an insight on the ways this company can improve to decrease expenses. This procedure is helpful in future budgeting with a good mind-set to understand the progress and also the ways this company lacks in delivering effective products. Recording information of supply chains helps this company to keep a track noon delivery time and whether the right amounts of products have been delivered or not. Aston Martin has effectively recorded data by involving an efficient IT and logistics team.
Analysis of impact of procure activities in achieving goals
Aston Martin Lagonda has achieved success not only by manufacturing efficient products but also by following the right procurement activities to achieve goals with increasing sustainable development manufactures. Procurement activities have been followed by some steps and it has cooperated with this automobile company to have an oversight on the company’s development goals. Engineers of the development of cars have been choosing right amount and quality of products to build cars that are under safety measures of the company. As opined by Cheniniet al. (2021), inspecting goods and services are important for quality checking of car manufacturers to find fraudulency. This procedure helped this company to be sure about products that are being used to develop sustainable vehicles. Based on the analysis of Afolabiet al. (2019), an automobile company needs to negotiate with different clients and investors to get an idea about the competition in the market. This helps to implement strict methods to compete with other companies.
Knowing competition helps this company to improve on manufacturing style and it increases development management of this company. Purchase request helps this company understanding the way supply chain works and to implement modern slavery act to impact on other companies to follow the world with right ethics. Keeping record of all the activities of Aston Martin has helped the company to understand the process of the activities. It has also helped in strategically planning future of this organisation. Keeping records helps in getting an idea of budget, manufacturing plan and procedures, which has helped this company to budget planning that facilitates in decreasing unnecessary expenses. It has been observed by Fu et al. (2019), keeping track on development helps in finding errors that can be rectified by the quality manager. This impacted the company to be more efficient in delivering sustainable vehicles.
Objectives of competitive advantage
Cost
Every company will have to achieve success first with cost budgeting and to compete with other companies. Aston Martin Lagonda has cost from all the ranges of sports cars with their unique design and premium supercars that are technologically advanced through autopilot mode. This brand represents luxury, uniqueness and great performance, which is not found in other automobile companies. This has allowed it to attract potential customers that never had to compromise their money as this brand is affordable for ordinary people as well. Being affordable has made this company sell a lot of cars, which has allowed it to increase profits and revenues of this company. Although, premium cars of this company have blocked many customers as to not being affordable. Cost planning has made this company achieve an increase in profits and it has increased the ability to produce more sustainable vehicles.
Quality
Aston Martin has been acknowledged because of the uniqueness of their vehicles design in sports cars. Focusing on customisation for customers and modern technologies has been prioritised more by this company, which makes the company exceptionally special. The company has achieved more than 140 locations to be globally available and help in sales of their vehicles. Quality of Aston Martin has increased in terms of installation of advanced technology, which makes improvisation of car design. Customers are satisfied with their excellent quality of sports cars and it has been their advantage because of the customer’s brand loyalty. Critics of vehicle manufacture have awarded Aston Martin Lagonda the most beautiful cars award, which has attracted more potential customers.
Flexibility
Automobile industry always searches for ways to improve on manufacturing and innovations. The technicians of this company have invented 3D printing machines which have allowed this company to develop manufacturing cars on time. This printing machine has helped enhance car designs, which has saved a lot of time and expenses. This has allowed technicians who collaborate in delivering vehicles on time and increase the development process by hiring the right people for this task. This company has also collaborated with Daimler to deliver new innovative vehicles and at the same time the company is thriving to achieve other innovations of sustainable battery power. This company aims to produce various vehicles on time and meet demands of the customers.
Gender equality
Men and women work side by side in this automobile company to showcase that the company believes in equality. This has created a positive approach towards customers and employees both. Employees feel safe at working in Aston Martin and it has created a balanced workplace environment. Customers feel that this company respects equality, which creates a good brand name. This has achieved high profits as to hiring right employees to increase their improvements. This encouraged employees to communicate with manager of this company to build a good relationship. This helps in planning and sharing ideas on the ways to make this company successful and bring efficient changes in the company. Gender equality improves the unemployment rate in a workplace.
Marketing
Aston Martin focusing on their strong heritage, which has allowed this company to attract more customers. This company has a strong marketing brand name that allows it to attract potential customers. This company has been aiming towards ways to make their production management more innovative to build more technologically advanced cars, which follows safety measures that meet customer satisfaction. Marketing strategies of this company have been effective towards the customers as this brand has a strong presence because of their values. These values have connected customers with constant engagement through their customer care service. The website of this company has been designed in a way that represents the company’s ethics and values, which customer’s value. This has been an advantage to give competition to other companies.
(b) Analysis of risks in procurement
There are risks that are aligned with procurement process of this company, which gives an insight of risk management issues in Aston Martin Lagonda. As suggested by Tavares et al. (2021), goods services are not always assured to be of sufficient quality and it can raise risks on manufacturing efficient vehicles. This company has achieved its fame because of their quality of production of vehicles and it can be a huge let down. Therefore, more focus on quality of goods provides scope to choose a unique strategy, which makes improvement of manufacturing quality. Based on the analysis of Abdel-Basset et al. (2019), purchase requests need to be secured with government policies that can assure supply chains and the company both. This allows the company to be secured from fraudulent and illegal supply of goods.
There is always a chance of media representing wrong information and accusations about this because of strong branding. This company needs to plan tactical strategies with their PR team to handle situations that can make a weak impression of this brand. As opined by de Araújo Lima et al. (2020), negotiations need to be handled with a calm mind-set by leader of this company to showcase the leaders’ behaviour toward other people and employees. This creates a good impression rather than misbehaving with an investor that can affect negatively towards this company. All the advantages that this automobile company acquires can lead to risks if improvements are not being met.
Impacts of risks in procurement process
Insufficient qualities of goods that are used to develop vehicles can create a huge issue of quality disadvantages and will impact the company to lose brand name. Quality is the top priority of Aston Martin and it will be damaged because of insufficient resource quality. Misbehaviour is an ethical risk that most leaders face but this can lead to losing advantage on good investors or partnerships with other companies that provide knowledge on competition. This will create unnecessary chaos among companies, which will lead to disadvantages of this luxury car brand. Marketing is important for this company and it is one of the strong characteristics of this brand. It allows customers to be more informative about this company’s reputation and product qualities. Insufficiency in marketing can cause this company to lose face and it decreases customer attraction, which leads to reduction in profits. This company focuses on sustainability and only focusing on sustainability will decrease creativity in production management. Highly advanced technologies need to be secured and rechecked so that will create a good impact on the company.
Risk management tools
Figure 2: Aspects of PMI methodology
(Sources: Influenced by Pasco et al. 2019)
Methodologies are used to set plans and execute them accordingly with the processes that are being created for the development of an organisation. As influenced by Arikumaret al. (2022), providing guidelines for achieving specific projects and portfolios of management is discussed in PMI methodology. PMI methodology has been used to analyse the risk management issues of Aston Martin Lagonda.
Planning PMI is used to discuss and analyse the risks management of this automobile company.
Planning
This process revolves around problem solving with various alternatives, which helps in avoiding risks. Strict planning on budgeting needs to be done to be able to decrease unnecessary expenses to avoid going bankrupt. Based on the analysis of Pasco et al. (2019), effective budgeting helps in following essential expenses that will cut costs of other unnecessary expenses and it helps in using profit in increasing production management.
Effective strategy on marketing needs to be implemented in this automobile company to attract more potential customers to build strong brand loyalty. Customers getting attracted by brand name and its quality can solve a lot of issues that can cause risk. It has been observed by Taillandier and Adam (2018), sufficient marketing strategy creates an effective brand name which allows the company to explore more potential customers’ needs and demands. This will increase production management and innovations of developing new technologies that will be implemented in new car models. On the contrary Kotulaet al. (2018) stated that goods and services need to be inspected regularly and supply chain managers need to plan efficiently to inspect qualities of it. Therefore, an audit team needs to be implemented to make a report on sustainability of this company’s product to ensure quality management. As per the views of Willumsenet al. (2019), equipment of machine designing need to have regular servicing to avoid damage to any production of vehicles. There needs to be strict planning on marketing of this company to be able to give customers a high expectation and those expectations are being met by the production management.
PR team needs to strategically plan to handle situations about the false press release of this automobile company. Challenging situations need to be handled with resilience and with effective strategic planning to overcome issues. As influenced by Arazet al. (2020), strong marketing strategy helps in creating a good impression on customers and attracting potential shareholders. The production management needs to plan in ways so that employees can improve on their creativity and increase productivity. Manufacturing quality needs to be more efficient and effective regarding customer satisfaction and it is maintained by exploring good behaviours towards customers. Effective communication is needed to handle customers and understand employee needs.
Conclusion
Aston Martin Lagonda is a unique luxury car brand that believes in effective sustainable production of vehicles. In this case study, an introduction of procurement activities and the reason it has been implemented in the company. Automobile industry and its use have been explained and a thorough discussion on Aston Martin has been discussed. Furthermore, there has been discussion of the company’s procurement activities and identification of procurement is included in this case study. This company has advantages that have raised competition for other companies but managers need to focus on making more effective production that meets customer’s demands. Monitoring of employees needs to be another potential task of managers to keep a track on delivery of goods on time. Marketing team needs to plan more creative ways this company can improve their brand name to have effective relations with customers.
In this case study, impacts of procurement in this company have been discussed to get an insight of positive impacts of this company. The competitive advantages of this company have also been discussed to clear out the objectives of this company. Thus, there are good qualities of this company that need more improvements. Gender equality, quality of production and marketing are the key strengths of this company, which can be better with time. Analysis of risk management has been discussed to get an idea on the rising issues of this company. Impact of the crisis has been introduced to have an outlook on this company’s way to handle the situation. This has cleared out that every sector of the automobile company is important and managers need to focus on improving every department. PMI methodology has been discussed to give planning ideas and to showcase alternative planning’s of this organisation to increase productivity and achieve goals. Aston Martin has achieved success with continuously increasing their innovative ideas, which has made this company open stores and export their cars in various countries.
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