The year is 1982. An unidentified person injects cyanide into some of the Tylenol medications detected as purchased from supermarket drug shelves in Chicago. As a result, seven people lost their lives. When and where the injection is performed is unknown. At that time, Tylenol was the most widely used pain reliever in the US, with a 37% market share. Subsequently, public panic is emerging and being heard across the country. Because Chicago is also a brand city and attracts a lot of attention for this reason. In the days following the event, market share drops to 7%. FBI officials contacted Johnson & Johnson management, the manufacturer company. They say this is an isolated event, and it is clear that the event is realized by a person who has mental health problems or wants the Company to kneel on. They recommended that it is unnecessary to withdraw the drugs from the market. But Bill Weldon, the CEO, is not in the same mind about this issue with the FBI. Since the problem is related to public health and there is a state mention in the Mission Statement, it was decided to stop the production and advertising, recall all the drugs from the market (31 million boxes), and declare the situation using all national written and visual media. (According to the Mission Statement written in the middle of 1940s, it was written in the first line of the first paragraph that “We are responsible to doctors, nurses, patients, mothers, children, namely, who are using our drug.”) Production is stopped without losing any time. The product is recalled from the market, and the situation is declared via all national written and visual media. Public awareness is tried to be provided about not using the related drugs. Essentially, the case is an isolated event, and the dominant opinion is that there is no direct relation with the Manufacturing and Supply Chain of the Company. Despite the high cost, the firm shows ethical behavior, which most companies do not exhibit, and takes the necessary actions since the issue is precisely associated with human life. Shortly, new products launch into the market with a secured package against external intervention through 3 phases. (Package is designed to be revealing any external intervention.) Any company does not implement this level of security until then. The Tylenol Crisis also led to significant improvements in the packaging process in the pharmaceutical industry. While the product is entering the market again, it tried to achieve its former market share using various marketing tools, and the cost was higher than expected. Also, it was provided to replace the former drugs with new ones. The former market share was 37%, which decreased to 7% the week after the event. But it increased to 46% about 100 days after the event. Because the public trusts Johnson & Johnson, and the related drug has a security level that none of the opponents have. So, the previous negative situation has become an advantage with proper risk management. An investigation is started in the Company from top to bottom. Meanwhile, it was revealed that one victim brought the drug not from the supermarket but from the hospital. (Hides from the public) It was investigated when and where this could be happened. According to the results of the investigation, it is probably the Supply Chain Process that the related injection is realized (Distribution and packaging process). Because the similar/closer problems are seen in 6 products. Deficits are identified and immediately corrected. Meanwhile, healthy operations were ensured by coordinating with federal health officials. Although the company officials think that the injection is realized within the Supply Chain, they declare that it is performed in supermarkets, as the FBI stated, because the Company shall not be responsible in this case. Later, the FBI deepened its investigations, and it was detected that the related intervention was performed in one of the Supplier Companies. Some of them are caught, but clear evidence cannot be found for any of them. Remarkable decisions are as follows; There is compliance with the Mission statement. It was ensured that the information was not only written text on the wall or internet website but also applied. Since the issue is directly related to public health, it was assumed that the failure belonged to the Company and acted without losing time. However, there is no evidence, and FBI officials recommended otherwise. What can be done to avoid such a situation and change the packaging approach? It was provided to replace the former drugs with new, clean ones. Tylenol Crisis is one of the good examples of Risk Management. References https://iml.jou.ufl.edu/projects/fall02/susi/tylenol.htm https://www.youtube.com/watch?v=iTdgUGNVirI https://www.youtube.com/watch?v=zPccWPCF9Ak https://www.youtube.com/watch?v=iCizOq-KbEI&list=PLXdS4HDCSM-1ELXAJtotNozsc7qV0IPUv January 10, 2016 - İstanbul

Nissan in Crisis Nissan, searching for methods to get rid of the financial crisis it went through in 1990s, also known as lost decade, upon Daimler&Chrysler’s renouncing the partnership (Ghosn, Shift, 2003, p. 125) because of the rejection of its demand to buy more than 50% of the shares, signed a cooperation agreement (made an Alliance) with Renault in March 1999 and sold the controlling stake to Renault. Nissan’s objective in this alliance can be summarized as having a say in Europe, as for Renault’s goal, it was gaining a more efficient technology. The main approach was, by creating a synergy, removing each other’s deficiencies with the logic of “two companies and two brands” rather than “one company two brands”. According to Carlos Ghosn’s statement; both brands were almost in a perfect accord with each other. (Ghosn, Shift, 2003, p. 108). The signed agreement was not a merger but an alliance. The difference was the existence of not one but two self-governing companies. In this case, both companies contributed by complementing each other. Nissan’s high production quality, engineering, reliability; merged with Renault’s innovative designs, superior market power and successful cost management. At the same time, Nissan was dominant in Far East market and Renault was dominant in European market. Nissan’s profit margin has been very low since it was clutching at the market in the last 8 years, which it was in crisis. For example it was estimated that the company was making a 1000-USD concession for each vehicle it sold in American market. However, its purchase cost was 15-25 % higher compared to Renault’s. Because of financial difficulty the launch new models was delayed and outdated vehicles, compared to market, was being sold. The company had 1 million surplus a year in production capacity. As a result all of these Nissan was constantly losing in its operations, facing an increasing investment crisis and experiencing an almost chronic financial bottleneck. (Kılınç). It was decided that both companies would join their forces by keeping to be independent and local; One platform and technology but two different designs (250 million USD saving for each platform) One engine design (100 million USD saving for each engine) One factory investment (500 million USD saving for each factory) Renault appointed COO Carlos Ghosn, an engineer of Lebanese origin, as the chairman of Nissan. Carlos Ghosn was the fourth non-Japanese executive appointed to a Japanese car maker. Carlos Ghosn was transferred to Renault as vice-president in 1996 having been the CEO of Michelin in North America at the end of 18 years. After his success in Renault, Carlos Ghosn first became Nissan’s chief operating officer (COO) and then a year later became the company’s chief executive officer. Nissan also supported this appointment decision of Renault because of Carlos Ghosn’s success in 20 Billion Plan. According to the Agreement; Renault would buy 36,8 % of Nissan’s shares for 5 billion USD. (Ghosn, Shift, 2003, p. 1305). - GM Vice-president Bob Lutz defined this as “Leaving a container including 5 billion USD into the middle of the ocean to sink” (Ghosn, Shift, 2003, p. 1361). - Ford’s CEO Jack Nasser said that “We don’t want to waste our hard-earned money paying off careless depts.” (Ghosn, Shift, 2003, p. 2058). Both companies would keep their own names and identities. 1999 – Nissan Revival Plan (NRP) (3-year revival plan) Carlos Ghosn immediately started to work without wasting time and negotiates as many people as possible from the lowest rank to the highest and takes into consideration their ideas and determined the situation and solutions. In this process almost 2000 ideas were taken into consideration. (Ghosn, Nissan Revival Plan, 1999, p. 15). The most interesting of all, when asked why did the company fall into this situation, nobody, including the ones who had been in management, could give a clear answer to that question. The reasons determined by Ghosn (Ghosn, Shift, 2003, p. 1628) The company is not profit-oriented, in fact profit must be in the center of the goals. Managers are not sure of the results of their decisions. (It is not certain or clear that whether the company makes profit after the sale of the cars) According to the result of the cost analysis, which are done later, only 4 of the 43 models make profit. (Ghosn, Shift, 2003, p. 1637) Toyota’s successful strategy is patterned after (copied exactly as it is applied in Toyota). However, instead of copying a prescription, it is necessary to find out solutions peculiar to the company. The period of goals is too long because urgency is not perceived. (For example, Although a time limit determined by Ghosn is only 1 week, the management sometimes set it as 1 year.) The quantity and priority of goals are not clear. Being used to problems Not sharing knowledge and not feeling responsible as a result of departmentalization. The voice of those who have innovative ideas is not heard. Nissan under the management of Carlos Ghosn, prepared a short term recovery plan, Nissan Revival Plan covering the period between 1999 and 2002 and presented the plan to the media on the 18th of October 1999. In order not to cause any rumor before the briefing, the explanation was made to the 148.000 employees at the same time with the media briefing. (Ghosn, Shift, 2003, p. 2018). The Goals of the Plan (Ghosn, Shift, 2003, p. 201) Returning to profitability for the fiscal year of 2000 Reaching to 4,5% profit growth at the end of the fiscal year of 2002 50 % decrease in loan (borrowing) until the end of the fiscal year of 2002 Carlos Ghosn and other members of board of directors declared that they would resign if they didn’t reach the goals above. (Ghosn, Shift, 2003, p. 201). Assuming the plan is successfully realized, the company’s projection for 2 years and 5 years later is shown as well. (Ghosn, Shift, 2003, p. 2159). The goals at first causes surprise among the employees. Some managers who are not in the board of directors reacted to those goals. But nobody could say “I don’t agree with these goals, I object to them” about the goals which were considered to be the only way to recover the company from downfall. If they said “no” it meant they had to go. This Revival Plan required some actions; 1- Closing down 5 factories in Japan and as a result of this laying off 21.000 Nissan employees, most of whom work in Japan. (This number equals 14 % of the workforce) (Ghosn, Nissan Revival Plan, 1999, p. 42) 1.1- The production in Japan was operating with 53 % capacity. It was aimed to reach 80 % capacity use after factory close-down. 1.2- Thanks to his strike experience in Michelin, Carlos Ghosn knew how to approach to the syndicates and dealt with them quite openly. He told them that if any action was not taken it was obvious that the company would go bankrupt within 5-6 months. He explained the current situation using data. He got the support of workers’ representatives provided that he takes their observations into consideration. 2- In 1999 the number of platforms/models were decreased from 7 plants and 24 platforms to 4 plants and 15 platforms as a result of this change productivity was increased. (Ghosn, Nissan Revival Plan, 1999, p. 31) 3- Nissan’s share (some of which didn’t belong to Nissan) in Japan’s distributorship system was decreased by 10 % considering the coverage zones. 4- Unproductive and redundant fixed assets were sold off. (Ghosn, Nissan Revival Plan, 1999, p. 37) 5- The Keiretsu system which means working with a chain of finance, material/service suppliers, was left gradually and the number of suppliers and partners was decreased. 5.1- The Keiretsu system is widely used in the Japanese automobile industry. According to this system, the companies within the system have to prioritize the companies in the chain when supplying goods. And this rule makes it unnecessary to behave competitively for the suppliers. Carlos Ghosn’s goal was leaving the system gradually. He was planning to provide the company’s supply in better conditions by collaborating with Renault and using scale of economy. As there weren’t anybody else who left this system before, Carlos Ghosn started to be known as “Killer of Keiretsu” in the automotive sector after this decision. 5.2- Within this framework, Nissan’s shares in many supplier companies, which Nissan was cooperating and no longer wanted to work with, were sold. 5.3- The number of suppliers was decreased from 8.145 to under 4.000. 6- Supplier Management (Nissan 3-3-3 Program) (Ghosn, Nissan unveils Revival Plan, 1999) 6.1- Nissan 3-3-3 Program was prepared 6.1.1- 3 Partners “Supplier & Purchasing & Engineering” 6.1.2- 3 Years 6.1.3- 3 Regions “Asia & America & EMEA” 6.2- Carlos Ghosn talked to all the suppliers as he did in Renault explained the details of the plan. He demonstrated the suppliers that Nissan would make a lot of sacrifices and this attitude inspires the suppliers’ confidence and as a result they agreed to make considerable amount of discount in their prices. 6.3- He expressed that they would understand those who didn’t think of standing by Nissan and also added that they wouldn’t forget those who would be standing by Nissan due to their stance at that difficult time of the company. 7- Bringing the car parts in compliance with market standards 7.1- New designs were made to use parts in market standards, to share parts within Nissan models and between Nissan and Renault models. 7.2- For example, even producing a Nissan size tire requires 20-25% extra cost. 8- The sale of aviation unit 9- Changing the official language of the company from Japanese into English 9.1- Most of the members of the company including board of management either didn’t know English at all or knew very little. This caused an important communication barrier. (Ghosn, Shift, 2003, p. 1610) 10- Adapted meritocracy and appointed managers from Europe and North America to the crucial positions. 10.1- Most of the members of top management were composed of a homogeneous group of people who graduated from some specific schools and were coming from the same city. This homogeneous structure enabled an easy management but at the same time curtailed an open-minded and objective management. 10.2- The main criterion in the current promotion and wage system was the period of time rather that performance. 10.3- With some new changes, the company discharged the redundant and low performing staff. 10.4- The staff who had been working for the company for a long time were put into an advisor status. 10.5- People who from Europe and North America, at the same time having a different perspective, were appointed to crucial positions. (Priority was given to Renault staff because they already knew Renault working system.) 10.6- The number of board of management, which was not able to meet very often due to a crowded number, was decreased from 37 to 10 people, including only the leaders of units and top managers. (Ghosn, Shift, 2003, p. 1610) 11- Setting up Cross Functional Teams (CFT = Cross Functional Team) (Ghosn, Shift, 2003, p. 1690) 11.1- The company adopts a cross functional team approach instead of a centralized bulky structure. With this new structure, specialists coming from different departments take different approaches and find better solutions to the current problems, providing transparency and positive change in the company. (Kılınç). 11.2- The hierarchy of Cross Functional Teams: “Cross Functional Team Leader > Cross Functional Team Pilot > Sub-teams” 11.2.1- The number of leaders for each team was determined as 2 in order to exchange more ideas. 11.2.2- The number of CFT pilots was determined as 10 people. 11.2.3- Sub-teams were formed under each CFT pilot. 11.3- With the help of 9 Cross Functional Teams composed of approximately 500 people in total; 11.3.1- Costs were reduced by using good quality but cheap parts whose functions were almost the same. 11.3.2- More parts were shared among different models by changing design. 11.3.3- Thus, operating costs were reduced. 12- Updating the wage system 12.1- The wage system, which was based on outdated criteria such education, age, seniority, family responsibilities, was changed. 12.2- Those who come up with innovative ideas were rewarded with a premium as an incentive. 12.3- Top management was given shares of the company as an incentive. 13- Redefining the power and responsibilities 13.1- When problems occured, current general reaction was blaming other teams for the responsibility. 13.2- The responsibilities were redefined and the employees were encouraged to take initiative to use their power. 14- Providing Transparency (Kılınç) 14.1- Here transparency did not mean only being audited by independent auditing companies. At the same time, it meant that “there was no difference between what a company thinks, says and does.” 14.2- Corporate communication was given importance. Decisions made in the periodical meetings were shared with sub-staff. 14.3- All communication channels of the company were re-organized, as much information as possible shared on time. 14.4- The employees were coming from different parts of the country and they were in contact with millions of people. This meant that reputation of a transparent company would be better all around the country. 15- Works on brand image (Kılınç) 15.1- The new vision was “Enriching people’s lives” 15.2- New mission was ” Nissan, with its merger with Renault, gives perfect measurable values and services and provides innovative automobile products to all of its partner interest groups. 15.3- New slogan was “Change your expectation” 16- Updating the design department 16.1- It was moved under the engineering department and linked to the board member who was repsonsible for Product Planning. Thus it became more independent. (Ghosn, Shift, 2003, p. 2189). 16.2- A Japanese manager, who was not negatively affected by Nissan’s last unproductive ten years, was appointed to the top of design group. (Ghosn, Shift, 2003, p. 2195). 16.3- The company started behave more bravely in terms of design. As a result of this, series such as Primera and FX reached successful sales charts. 16.4- The number of female staff in marketing and design was increased. More than half of the cars, which were sold around the world, were either bought by women or decided by women about which model to buy. As women played such an important role in the sales of the cars, it was thought that men’s marketing and designing the cars which were to be bought by women would be an imperfect approach. Special attention was paid to this issue. When the plan is to be applied, the progress is transparently presented to all by giving a detailed explanation every 6 months. (Ghosn, Shift, 2003, p. 2097) At the same time, this is putting change into a perspective. (Ghosn, Shift, 2003, p. 2866) When it is the end of March 2002 (8 months before planned), all these targets of Carlos Ghosn were fully achieved and Nissan became on of the firms with the highest profitability rate of the automotive market with 9% (Ghosn, Shift, 2003, p. 207). According to what employees working in the company said, “Condition of Resignation” was one of the important factors motivating the employees. Following this success, Renault increases its share at Nissan to 44,4 % (Ghosn, Shift, 2003, p. 219). 2002 – Nissan 180 (3-year growth plan) In May 2002, Carlos Ghosn announces a new 3-year plan called “Nissan 180” (180 is formed of the numbers of the targets.) (Ghosn, Shift, 2003, p. 2785); Targets of the plan (Ghosn, Shift, 2003, p. 207) From 2005 Spring and afterwards, the global sales will increase by 1 million items (Between 2004-09 and 2005-09, the sales have increased up to 1,2 million items). Profitability will be increased to 8% (it was reached to 11.1% at the end of 2003 financial year). With the Spring 2005, the market debts will be decreased to “0” (reached at the end of 2003 financial year). 2005 – Nissan Value-Up (Sustainable Performance) After the success of previous recovery and growth plans, Carlos Ghosn starts working for a new plan. Targets of the Plan (Ghosn, Shift, 2003, p. 2885); The annual global sales will be increased to 4,2 million items until the end of 2007 financial year. The profit margin levels at the peak of the market will be preserved. Return on investment will be at least 20%. The main elements of the Plan Higher profit. Higher speed and quality. More cooperation with Renault. According to this plan (Ghosn, 106th Shareholder Meeting, 2005); 28 new models to be produced for the market (18 models to be updated + 10 new models). Infiniti brand will be turned into luxury global brand. Light commercial vehicle market will be focused. The profitability rate of 4% in the light commercial vehicle market will be increased to 8%. Supply network will be strengthened. Assets in China, Thailand, Arab Peninsula, Egypt, Russia and Western Europe will be strengthened. 10 new security technologies will be developed (Ghosn, Nissan Value-Up, 2005, p. 56). 2008 – Nissan GT 2012 (Growth and Trust) The next plan of Carlos Ghosn was “GT 2012” consisting of 2008-2012. He aims a long-term performance with the plan consisting of the first letters of Growth and Trust. (Ghosn, Nissan GT 2012, 2008) (Nissan, Nissan to Announce Mid-term Quality Improvement Program “Nissan GT 2012 – Quality Leadership”, 2008) Targets of the plan (Nissan, Nissan to Announce Mid-term Quality Improvement Program “Nissan GT 2012 – Quality Leadership”, 2008) Warranty issues will be reduced by half. The rate of supplier damaged goods are to be reduced by half. Car breakdowns will be reduced by half. Spare parts supply time will be reduced by half. The zones with the highest customer satisfaction rate will be doubled. The number of high quality products will be doubled. However, the plan was suspended in 2009 due to the financial crisis in 2008 and the related slowdown together with the currency fluctuations (Ghosn, Nissan GT 2012, 2008). 2009 – Nissan Recovery Plan Due to the 2008 Economic Crisis, Ghosn had to suspend the “GT 2012” plan temporarily. And he prepares a new plan. According to the plan (Ghosn, Nissan Recovery Plan, 2009) The number of workers will be decreased by 20%. Until the condition gets better, a wage deduction of 10% will be made from Board of Management members and of 5% will be made from Managers. The Bonus to be given to the Board of Management for the 2008 financial year will be canceled. Overtime work will be reduced by 75%. Production days will be reduced in February and March. There will be cuts in travel expenses by 75%. Recruitment from countries that require a high minimum wage will be kept at a minimum. Sponsorships will be reduced. Assets not related to the main business will be sold. Dividend payments will not be made. Revolving funds will be developed. 2011 – Nissan Power 88 The man of plans, Carlos Ghosn, announces his new 6-year plan between 2011-2016 called Power 88 in June 2011. (Nissan, “NISSAN POWER 88” MIDTERM BUSINESS PLAN ANNOUNCED, 2011) Targets of the plan (Ghosn, Nissan Power 88, 2011) Power => Brand and sales force 8 =>8% market share 8 =>Sustainable profit rate of 8% Things to do according to the plan (Ghosn, Nissan Power 88, 2011) A new model to be produced every 6 weeks The number of models will be 66 with the new models to be produced and therefore 92% of the market will be covered. 90 New technologies to be developed. Summary of Developments in Figures Partnership with Dongfeng An agreement is made with the Chinese Dongfeng company in 2002 (Ghosn, Shift, 2003, p. 3134).(2002) According to this agreement; Nissan will invest 1 Billion dollars in Dongfeng and will come a 50% partner of the newly opened Dongfeng Motor Company. Dongfeng will produce the light commercial vehicles of Nissan under the name Dongfeng (Nissan Diesel brand will not be used) (Ghosn, Shift, 2003, p. 3214), Dongfeng will continue to produce Nissan’s cars under the name Nissan. Together with this agreement, both the production costs have been decreased and a stable place was obtained in the market by signing a contract with the greatest producer of the Chinese market. Electric Vehicles (2007) Carlos Ghosn tries to focus on this topic as he sees that the automotive market leads towards electric vehicles and he separates a budget of 4 billion EUR to the electric vehicle studies. According to the plan, the model range of both firms will include “bottom up” electric vehicles. Within this plan, Nissan Leaf model is introduced to the market in 2010. Carlos Ghosn who was exposed to great criticism due an enormous budget he kept, said “We will foresee the future, so we will prepare, if happens, we will be ready..”. Partnership with Daimler (2010) An agreement is signed in April 2010 with Daimler in order to show presence in the upper segment commercial vehicle sector. According to this agreement* Mercedes-based high-end cars will be produced for Renault and Infiniti. There will be collaboration for the development of commercial vehicles. In 2014, 4-cylinder gasoline motor vehicles will be started to be produced for Mercedes and a partnership will be started by opening a factory in Tenesse. Diesel engines will be supplied to Mercedes. Collaboration will be available in the processes of developing electric vehicles and petrol engines. *Framework of agreement is continuously growing. Tsunami Disaster (2011) March 2011 brings a large Tsunami disaster together for Japan. This demonstrates how successful leader Ghosn was. The Iwaki Motor Factory produces 60,000 motors annually at a place 42km far from Fukushima. And the factory is at a non-operating state after the disaster. The total cost of the disaster was $ 732,5 million for Nissan (Greimel, 2012). One day after the disaster, he starts an evaluation of the situation with his team and determines what could be done; He gives authority to the managers of the factory by removing the central authorization and allows them to make instant decision for themselves. It switches from Pull Production system to Push Production system (Pull Production system, also known as Toyota Production System is left.). Factory starts reworking in Mid-May with a capacity of 80%. It starts working fully with a complete capacity in September. Finally, he breaks a new record closing the production of 2011 with a 14,04% increase compared to the previous year. Fruits of the success of Ghosn Ghosn became the CEO of Renault & Nissan Alliance in 2005 due to his success (Ghosn, Shift, 2003, p. 3293). And therefore he becomes the first CEO managing two firms at the same time in the Fortune Global 500 list(The number of employees of Renault & Nissan Alliance was 300.000) (Ghosn, Shift, 2003, p. 3302). GM The billionaire businessman Kirk Kerkorian, affected by the success and perspective of Carlos Ghosn, buys 9,9% of the shares of General Motors and gets into the board of management. Then, GM management encourages to establish a partnership with Renault&Nissan Alliance under the management of Carlos Ghosn and to bring Ghosn to the head of this partnership. GM Management does not approach to this and Kirk sells his shares. Ford Ford company, in a very difficult position, brings an official proposal to Carlos Ghosn to be the head of management in 2006. However, Ghosn rejects the offer due to the rejection of Bill Ford Jr. to give the titles “CEO and Board of Directors” together. Promotion at Renault & Nissan Ghosn becomes both the CEO and the Board Chairman of Nissan and Renault in 2008. Other information In 1999, only 4 models out of 43 available models were profitable. In 2015, all 65 models were profitable. The sales of 2,4 million in 1999 increased to 4,8 million in 2011. Targets were written until 2060. In 2011, half of the Nissan executive management was from abroad of Japan. There were firms that wanted to provide consultancy services but Carlos Ghosn rejects. This is because they come with ready prescriptions and they do not listen to the problems within the firm. And when actions take place, such firms do not feel a responsibility as much as Nissan managers do. Nissan 350z is redesigned as a continuation of the old Datsun 240z as a symbol of rebirth (Ghosn, Shift, 2003, p. 213). The production of a new platform with a market evaluation of 24 months is reduced to a record level of 12 months (Ghosn, Shift, 2003, p. 2943). Instead of the general approach of the market, Hybrid (Internal combustion + electric) motor, only electric motor was insisted (Ghosn, Shift, 2003, p. 3006). An agreement is signed with Toyota in 2006 yo produce components for electric vehicles (Ghosn, Shift, 2003, p. 3044). Factories intended to be bought from the regions where models were sold in abundance and in this way the currency fluctuations left the least effect (Ghosn, Shift, 2003, p. 3098). One of the greatest reasons why China could not buy the productions in Japan was that Japanese suppliers knew the firm well and they could reply to their demands very fast (Ghosn, Shift, 2003, p. 3125). Carlos Ghosn The first language that Carlos Ghosn, Lebanese origin, Brazilian-born, with Maronite faith, learnt was Portuguese. One day he becomes ill due to the unhealthy water given by his neighbour and he comes to Lebanon with his mother at the age of 6 to live in a cleaner environment. His father stays in Brazil to work (Ghosn, Shift, 2003, p. 307). He learns Arabic, French and English as well. He is a man who normally speaks in English but he can also express himself in French (Ghosn, Shift, 2003, p. 351). Carlos Ghosn completes his primary education in Lebanon and goes to France for his university education in 1971 at the age of 17 (Ghosn, Shift, 2003, p. 319). Due to the Lebanon war in 1975, all his family needs to come to France (Ghosn, Shift, 2003, p. 439). Michelin As soon as he finishes university, he receives a job offer from Michelin as research expert but he rejects it by saying “I do not want to be a Tire Expert” and says he want to work at production. This is because that is the place where everything takes place. His offer was accepted and he starts working at production. Starting from the beginning makes him gain experiences (Ghosn, Shift, 2003, p. 550). He shortly climbs the career steps up (Ghosn, Shift, 2003, p. 569). When he left Michelin in 1996, he was the North America Factory Manager. In 1981, when Michelin took Kleber, he was asked to prepare a report by the head management. And during this period, he realises that two firms complete each other. Kleber is good at the tires of agricultural vehicles and Michelin is good at the tires of light vehicles. Carlos Ghosn recommends the division of production of two firms and to depart from the scope of each other and nearly all of his recommendations are implemented (Ghosn, Shift, 2003, p. 629). After the problems in production in Brazil in 1984, he was assigned to Brazil as a factory manager (Ghosn, Shift, 2003, p. 647). Michelin company produces rubber from natural rubber fields in Brazil. The production of both rubber and tire is performed by the same management. Although being proactive in this region where the inflation and currencies are quite fluctuating is very important, many mistakes are made due to the management style. He prepares a quick plan, he starts working to resolve this and a number of irregularities and structural problems like this and he succeeds in a short time. During this period, Carlos Ghosn experiences a strike and overcomes this with success (Ghosn, Shift, 2003, p. 733). His success brings him to the position as North America Factory Director (Ghosn, Shift, 2003, p. 780). During this period he sees that he cannot be number 1 with the warning from his wife because Michelin is a family business. He decides to quit at the top of his career and starts searching. This process brings him to Renault in September 1996 (Ghosn, Shift, 2003, p. 987). Renault He comes to Renault at a complex period. However, in his own words, “Joining a team during a problematic time provides you many opportunities”(Ghosn, Shift, 2003, p. 1066). The greatest problem that Renault encounters is the high production costs. Carlos Ghosn takes this project and prepares the 20BillionPlan (frank). According to the plan, he changes the plan to decrease the cost by 3000 franks per vehicle within 3 years, which was the first target given to him, as 9-10.000 franks. The plan consists of decreasing the costs in all areas. The plan is explained in March, 1997 (Ghosn, Shift, 2003, p. 1139). The plan consists of closing down a company in Belgium. He also meets the suppliers and provide them with details. During the years at Michelin, he gained a lot of experiences by sitting at the opposite side of the table for a long time. Under the plan, Renault provides confidence to the suppliers that it will make greate sacrifice and gets important discounts. This plan succeeds in 1999 (Ghosn, Shift, 2003, p. 1249) and he gains the nickname “Cost Killer” (Ghosn, Shift, 2003, p. 183). His success in the 20 Billion Plan will be the main factor leading him to the head of Renault&Nissan Alliance. … Full of career achievements, Carlos Ghosn is a leader devoted to this sector who annually travels 150.000 miles between Tokyo-Paris, has a complete travel and visit plan for the next year, who continuously works from the early morning until the late night with a nickname “Seven-Eleven” and listens to the ideas of all groups including workers. Staying away from the politics, the public is asked in a survey made in 2011 in Japan “Who would you like to govern Japan?” and Carlos Ghosn was the 7th, 12 times before the Japan Prime Minister. He also has his name in the Japanese menus as “Ghosn Bento”. Main problems that Ghosn struggled 1999 Nissan Financial Crisis 2008 World-wide crisis and the recession afterwards 2008 Yen crisis 2011 Tsunami and Fukushima October 2011 Thailand flood Recommendations Always evaluate the current situation objectively and quickly. Set priorities, share them with everyone, give everyone a post-crisis vision. Render communication simple. Authorize people. Make a difference. Empathize. Listen to the ideas. Managing is an art, not a science (Ghosn, Shift, 2003, p. 2821). Strategy counts for 5% but fulfilment counts for 95%. Be determined, discuss the way to target but stay on the target. Name the targets. Do not get used to the problem, feel uncomfortable. Be transparent if you make any mistake, accept it, and try to find an effective solution without losing time. Try to minimize the time between the moment when problems were created and the moment when they were solved. Do not be afraid to criticize your productions (materials/services) because “You have to accept that you are ill to recover”. Do not look at the figures, but the fact hidden behind. If there is fire at a place, shout “Fire!” and do not keep silent. Be disciplined; You do a little with a low discipline, You do a lot with a high disciple, There is nothing you cannot do with a complete discipline. Before concluding Numbers are not always the accurate and sufficient demonstrations to show the success of a company. The most important is about how much the employees, customers, managers, public interest groups and the general public are proud of that company (Kılınç). Therefore, in order to recover a company, it is necessary to focus on people first, motivate them towards targets, to be the source of hope for them and to create the feeling of possession (Kılınç). References -. (-, – -). Michelin leading the world’s tyre industry. Retrieved from Rezulteo Tyres: https://www.rezulteo-tyres.co.uk/michelin-tyres/car-tyre-brand -. (2010, December 7). Official Trailer: Revenge of the Electric Car. (-, Interviewer) Revenge of the Electric Car. Retrieved from https://www.youtube.com/watch?v=jkRIu5a6Sb0 English, A. (2006, February 11). The man with the plan. Retrieved from The Telegraph: https://www.telegraph.co.uk/motoring/2739782/The-man-with-the-plan.html Ghosn, C. (1999). Nissan Revival Plan. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/REVIVAL/DETAIL/1999/fs_re_detail1999h.pdf Ghosn, C. (1999, 10 18). Nissan unveils Revival Plan. Retrieved from Nissan Global: https://www.nissan-global.com/GCC/Japan/NEWS/19991018_0e.html Ghosn, C. (2002). Nissan 180. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/PRESEN/2001/fs_presen2001.pdf Ghosn, C. (2003). Shift. -, France: Doubleday. Ghosn, C. (2005, 06 21). 106th Shareholder Meeting. Retrieved from Nissan Motor Corporation: https://www.nissan-global.com/EN/IR/SHAREHOLDER/106_index.html Ghosn, C. (2005). Nissan Value-Up. Tokyo: Carlos Ghosn. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/2005/0425/050425presentationcolorE.pdf Ghosn, C. (2008). Nissan GT 2012. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/PRESEN/2008/presentation-080513-color_e.pdf Ghosn, C. (2009, July 27). Differences Are the Key to Partnerships. (S. University, Interviewer) Retrieved from https://www.youtube.com/watch?v=1M8RWJ929ck&index=1&list=PL16VDcaO8e56QE2kpzQPERQYV_PzWpbQw Ghosn, C. (2009). Nissan Recovery Plan. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/PRESEN/2008/20083rd_presentation_175_e.pdf Ghosn, C. (2011). Nissan Power 88. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/DOCUMENT/PDF/FINANCIAL/PRESEN/2011/MTP2011_presentation_339_e.pdf Ghosn, C. (2012, January 11). Detroit Speech. (-, Interviewer) Nissan Newsroom. Retrieved from https://www.youtube.com/watch?v=9MdhKOr_9Tk&list=PL16VDcaO8e54uPIAWw-rSfVhCES5MkWtT Ghosn, C. (2012, August 21). Diversity and Growth. (-, Interviewer) Retrieved from https://www.youtube.com/watch?v=rls6iDPLYUQ&index=16&list=PL16VDcaO8e55dvmYafqkqMON8jmMJgWRO Ghosn, C. (2014, January 21). Innovation. (S. University, Interviewer) Retrieved from https://www.youtube.com/watch?v=r2gZ_23z92o Greimel, H. (2012, March 12). Tsunami: The aftermath. Retrieved from AutoNews: https://www.autonews.com/article/20120312/OEM01/303129960/tsunami:-the-aftermath Imaoka, Z. (-, – -). Push-Pull Manufacturing. Retrieved from Lean Manufacturing Japan: https://www.lean-manufacturing-japan.com/scm-terminology/push-pull-manufacturing.html Kılınç, A. U. (tarih yok). Danişmend. https://danismend.com/kategori/altkategori/bir-degisimin-oykusu-nissanin-hikayesi/ adresinden alındı MilliyetGazetesi. (2014, October 7). Renault-Nissan ve Daimler arasındaki iş birliği artıyor. Milliyet Gazetesi: https://www.milliyet.com.tr/renault-nissan-ve-daimler-otoguncel-1951202/ adresinden alındı Nissan. (2008, September 1). Nissan to Announce Mid-term Quality Improvement Program “Nissan GT 2012 – Quality Leadership”. News Releases, p. 1. Retrieved from https://www.nissan-global.com/EN/NEWS/2008/_STORY/080924-02-e.html Nissan. (2011, April 1). “NISSAN POWER 88” MIDTERM BUSINESS PLAN ANNOUNCED. News Releases, p. 1. Retrieved from https://www.nissan-global.com/EN/NEWS/2011/_STORY/110627-01-e.html Nissan. (Updated). Financial Announcements. Tokyo: Nissan Motor Corporation. Retrieved from https://www.nissan-global.com/EN/IR/FINANCIAL/ Ünlü, H. (2012, February 4). Fukuşima: Savaşsız bir nükleer savaş. Evrensel Gazetesi: https://www.evrensel.net/haber/22480/fukusima-savassiz-bir-nukleer-savas adresinden alındı Wikipedia. (-, – -). Carlos Ghosn. Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Carlos_Ghosn Wikipedia. (-, – -). Keiretsu. Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Keiretsu Wikipedia. (-, – -). Meritocracy. Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Meritocracy Wikipedia. (-, – -). Nissan. Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Nissan April 15, 2016 - Istanbul

In the construction industry, organization types of purchasing units, which are in the position of heart of the projects, show differences due to distinctive structures of every company. I will try to examine the various pros and cons of purchasing organizations in which many variables are effectual. Centralized Purchase This type of organization is the one in which all purchase activities are conducted by a single central unit. This is an organization created by firms that perform buying/selling for more than one project/workplace to make purchases in better conditions (price, delivery time, transportation fee, etc.). There is no purchasing agent in the projects. This type is used more when a number of purchasing item is low but the budgets are large. However, some Group Companies / Holdings can choose to establish a separate firm for their purchases with common subjects. The most familiar example of this is “Zer Central Services and Trade Inc.” (https://www.koczer.com/) established by Koç Holding in 2003. Thus, they provide better conditions for purchase by benefiting from the economy of scale and enabling the group companies to focus on their business by clearing of businesses that do not create value. Coordinated (Combined) Purchase This type, intending to minimize the cons of the central purchase organization and to provide quick response times, is applied by making big-budget purchases by the central group, and small purchases by the project. The majority of purchase activity is performed by the purchasing agents in projects but is constantly coordinated and controlled by the central purchase. Independent (Local/Separate) Purchase As the generally-used organization type, this one is conducted entirely by the project (except for the Procurement unit in energy projects). In this organization, bureaucracy is at a minimal level as there are not procedures such as sending documents to the central group and receiving approval. Independent + Active Consultant Style Purchase (Regional) In my opinion, this is the type of organization that large-scale, project-based firms should use. I have combined the Coordinated and Independent purchase approaches here. In this type of organization, there is a regional active consultant along with the independent purchase type. The role of the active consultant here is to link the contracts of big-budget purchases with high discount rates according to ABC analysis by using the firm-wide control opportunity and to constantly investigate purchase activities of the projects remotely in coordination with the central quality group. Comparison table of purchase organization types April 17, 2016 - Istanbul

Measurement of Suppliers, monitoring, and reporting the collected information in detail is crucial in measuring the new supplier's performance, current suppliers' performance against the company, and the health of the supplier's guide. On the supplier basis, an evaluation report (Erdal, October 2011), such as the following example, can have detailed and general information about the supplier in the guide. The cover page of the above assessment should also include a summary report of the relevant purchasing specialist and the manager covering the topics (it is necessary to make the evaluation sound). Suppliers should be classified according to the sub-total score resulting from the performance evaluations, as in the following example; By sharing the summary results of these reports with the suppliers, the supplier, aware that it is constantly assessed and monitored, will be able to regulate itself considerably and be encouraged to work better. Supplier performance evaluations should be made over the ERP system and presented to the top management for approval. The central quality group should determine all evaluation criteria, and no changes should be made on a project basis. Intake should be taken to ensure that most purchases are made from preferential suppliers, as this will provide many advantages for the firm. References Erdal, M. (2011 October). Satınalma ve Tedarik Zinciri Yönetimi (2. Baskı). İstanbul, Türkiye: Beta Basım A.Ş. April 19, 2016 - Istanbul

As technology evolves, the variety of products and flow rates are also increasing. With each passing day, hundreds of new products are participating in each product group. The use of material code with reasons for increasing product type, quantity and flow rate should not be called luxury or burden. Classification and coding are inevitable for systematic monitoring of material flow activities. This systematic activity relaxes functioning (Nikam). Material coding can also be referred to as material identification (RAO). It will be beneficial for everyone to have a common code base within the organization and sub-details to be left to the projects (eg "drill-to-head" by center, dimensions will be determined by the project). It would be more appropriate to prepare this code structure not only with the central hand but also with the vision and experience of all projects. In this way, the teams in the projects can both develop and take ownership willingly by finding a piece from themselves. Employee ownership is a must for success. The material code structure needs to be prepared manually by the people in the business (buyer, warehouse, orderer, etc.), rather than as a filter list, on the resulting list of IT specialists filtering out the definitions of the previous purchases. It is not only the preparation of the code list but also the logic by which the breaks of the list are prepared. It will also be very useful to investigate similar samples in the world. A few of the purposes of material coding (Nikam); Sort similar materials under a single group (eg: All Profile's are listed under the same roof), To avoid duplication and confusion, Dispense differences of the definitions (multiple names for the same material eg straight iron = coiled iron). Some features that material codes should have (Nikam); It should be simple, Must be unique, It should be compatible with short, core and other similar materials, It should be flexible according to future requirements (eg: specific pipe diameters), Codes should be as understandable as possible so that you do not need a booklet. There are some surplus values to be provided when working with the material code system; By avoiding different expressions for the same material from one unit to another, wrong purchases of wrong goods may be prevented, Material unit prices can be reached quickly and accurately, Purchasing and logistics departments can control themselves much more quickly, easily and accurately, The logistics unit can easily group the materials on this side and access the desired information quickly, By avoiding duplicate definitions, awareness weakness that may result from stocking the same material in different places can be prevented, Classification makes reports more understandable, Units that do not have detailed information about material descriptions (Cost control, planning, proposal preparation, etc.) can filter the information they want more easily and quickly, The bid preparation unit can reach to the current prices quickly and correctly and also can see periodic price changes easily, The price comparison between the project and the projects can be done very easily, When talking to people inside and outside the group, you can be sure that you speak the same material, Census and classification sweeps may decrease. Besides, the addition of material photographs to the ERP system will be very helpful for orderers to see what they ordered and for price control to see and know what they control. In the following, the material code structure arranged in this direction can be seen; Material code structure example; Coloring may be useful for distinguishing codes more easily (Nicam). The codes must be generated via the ComboBox (Down slider) to minimize the errors in the code entries. ComboBox example; Sample material codes according to the above structure; References Nikam, D. (n.d.). Coding in material management. Retrieved from slideshare.net/: https://www.slideshare.net/dineshnikam180/coding-46939313 RAO, S. R. (n.d.). Codification in Materials Management. Retrieved from Cite.co: https://www.citeman.com/4466-codification-in-materials-management.htm 28 April 2016 - Istanbul

The quality control units are the backbone of the companies together with the human resources unit on the formation of company culture. Central and site inspections are usually carried out by quality control inspectors who do not have experience with purchasing. The purchasing unit, which has undergone several checks, can know the questions that may arise and/or can bend the answers. In addition to checking compliance with procedures, such audits need to go through as well as buying ideas. Procedures should be updated at specific times because time is changing and new logic and ideas are emerging. Experiences in purchasing units and the central quality control group should be shared during these inspections to determine what can be improved and treatment. Without rhythmic development, the company can not make profits. The lessons learned need to be written during these inspections, not at the end of the construction site. That is why the root cause of the problem can be understood when the system is more alive, the problem can be understood completely, the chaining effects can be calculated, can be understood why so far a solution could not find and some solutions can be tried. The lessons learned at the end of the project are not lessons because there is no lesson in the real sense as the chaining effects of a system that is not currently alive can not be accounted for. Applying learned lessons that not go down roots, is not a solution, just a move. Rapid resolution of problems that are not fully understood due to the root causes negative chain effects in the long run. It is necessary to ask a minimum of "5 Questions Why" for each problem and do this while the system is still alive. Washington D.C. The Jefferson Memorial event in "Why Ask Five Times" is a nice example (https://www.ideachampions.com/weblogs/archives/2011/05/some_years_ago.shtml) (Marcum, 2004); US Department of Parks and Monuments Washington D.C. About the Jefferson Memorial, the problem of stone wear. Because of the weary stones, the maintenance staff was wasting time, the tourists coming to the region were disturbed by a neglected view, and both the complaints and the maintenance costs were increasing. Other monuments built in the same period were in a healthy state. Authorities began asking questions; Why the question => Why is this monument more worn, even though it was built in the same period as other monuments in the nearby area? => Excessive cleaning materials used due to pigeon decay Why is the question => Why do pigeons come to this monument more than other monuments? => Highly intensive spider population Cause question => What is the reason why the spider population is intense? => Propeller drive Why the question => What is the reason for the propeller drive? => Due to the DNA, they come in a swarm at sunset, Why question => If we open the lights a few hours later, will the problem be solved? => YES! In the end, the problem is solved by adding 2 additional hours of lighting, without additional material/equipment and the addition of staff. As a result, the cost of cleaning supplies and cleaning personnel falls. This valuable information that is accumulated in the center needs to be shared with employees in all purchasing units. All learned lessons can be arranged into topics within a separate main menu within the ERP system. Easy accessibility under the hand creates curiosity and is read by users occasionally. This, in turn, leads to the creation of accurate perspectives on the future by taking lessons from the past. Procedures and learning lessons are included in the program of adaptation to newcomers to work, and it is necessary for the current working friends to be taught at regular intervals and their ideas have taken. It would be very helpful to have a central inspection unit in the central quality control unit or to have a period of experience in a different type of project (energy, construction, etc.) with intensive purchasing. As mentioned above, the point of view should not only be the control of the system but also the form of development. In addition, procurement units in projects should be informed about this point of view. References "Marcum, D. (2004). ""Marcum, D. (2004). İşGüdü. (Osman Deniztekin, Çev.) İstanbul, Türkiye: Varlık Yayınları. April 28, 2016 - Istanbul

Inventory management Warehouse management processes start with the arrival of the following material on the warehouse area and are terminated by being dispatched to distribution points. Inventory management, on the other hand, is a continuous system and operates in an uninterrupted manner as long as the project continues to operate (Görçün, 2013, p.10) The understanding of inventory management should be based not on goods inactivity, but on goods movement (Nebol, 2014 January). A warehouse system that adds value to the firm can not be built on stock keeping and stock storage. Inventory management is seen as a function that does not add value to project progress as one of the logistics activities. But because the supply of supplies is a key point and the quality of service it provides is important for the progress of the project, the project has a great share in its total success. The purpose of inventory management is to add value to the company for the sake of being; Choosing the location of the warehouse considering the conditions such as the location of the project, climate conditions, transportation possibilities, and security problems, To arrange the layout of the main warehouse, separation & consolidation warehouse and distribution warehouse (Armchair) according to usage characteristics and usage patterns of materials, According to the results of the ABC Analysis (20/80 Pareto analysis), a random one or more stock counts on the following cycle basis (collective count leads to job loss) (Nebol, 2014 January) - Group A, daily (Net stocks significant stocks), - Group B, once a week, - Group C, once a month and doubtful (net stocks of negligible stocks). Transmission of timely and accurate information about various information such as current inventory, periodical movement information of materials, Establishment of the necessary stock areas with optimum flexibility (enabling the stocking of other materials if they are not needed) Giving the materials to the field according to their shelf life (It is the first one with a low lifespan. FEFO) Work to dissolve inert materials for a long period of time (transfer to another project, return to supplier, scrap sales etc. if possible) Detailed inspection of the defective materials coming from the suppliers or returned from the field without losing time, keeping the report and delivering to the supplier firm together with the related report immediately, Taking necessary precautions considering the possibility of any kind of climate, theft or damage of the goods in the warehouses which are within the amount of money which is the same as the amount of money (Nebol, 2014 January) Taking inventory management costs to the lowest possible level - Achieving the lowest possible inventory management cost (Lean cost, number of employees, overheads, operational costs, etc.) using the existing volume most efficiently, - Separation of moving and non-moving materials, and easy access and rapid transfer capability to moving materials (Regulation of access distance to materials according to usage rates, keeping welded materials together such as torch and torch together) - Investigation of developments that will increase the efficiency of the inventory management (Equipment, rack system, RFID, BarCode, QR-Code, etc.) etc. should be. In addition, joint ventures should be provided for all the warehouses within the company (Projects and Country Center Pavilion). Close projects are able to see the material information of each other's stocks (shown as excess stock in the system), as well as to integrate best with the projects in warehouse areas in the Country Center Ambassador status. The use of inventory areas in the main warehouse status only in the activities of mobilization, demobilization, and transfer of goods is an approach that does not add enough value to the company. Debit The debit is a problem that every warehouse management is suffering from. Unfortunately, this issue is noticed at the end of a project or problem. The debit following is done via Excel spreadsheets. The procedure of this subject should be based on the common ideas of purchasing and logistics group employees working on the projects, the ideas of the project management and final quality control. This issue can not be solved without the significant contribution and support of top management. Implementation of the established procedures should be ensured under all circumstances. It should be ensured that the various editions of the relevant department managers are not effective. The cost of not being able to follow the debit is not a casualty, but a costly penalty that adds no value to the company. QR-Code and BarCode application One of the biggest problems in warehouse management is the inability to enter the locations of the input/output materials in a healthy way. The materials subject to deposit consolidation, separation and raffia removal can be placed at different locations or at different locations in the same locality due to site distress. As input and output operations are multiplied, errors can be made due to operator or warehouse error/forgetfulness. These mistakes that can be noticed late can lead to job delays due to the assumption that there is a stock in the inventory due to the assumption that the material related to the chain is not stalled. With QR-Code and BarCode applications, mistakes can be reduced the less. In this system; a code label is affixed to each new item, and if the code label is present on the incoming item, this label is tried to be used. At this point, both the workforce will be reduced the less and the mistakes will be prevented. References Görçün, Ö. F. (2013). Depo ve Envanter Yönetimi. Ö. F. Görçün içinde, Depo ve Envanter Yönetimi (s. 240). İstanbul: Beta Basım A.Ş. Nebol, E. (2014 January). Tedarik Zinciri ve Lojistik Yönetimi (3. Baskı). İstanbul, Türkiye: Beta Basım A.Ş. May 5, 2016 - Istanbul

Mobilization The mobilization of projects is the most troublesome process. In these processes, you face almost the same problems every time. If the project is in a new city, the problems become even heavier. One of the most experienced persons from purchasing units is required to enter the supplier portfolio survey in this region for 1-2 months in the proposal process. The cost here can be seen as an expense rather than an investment if the project can not be bought. But, if the project is bought,it will provide great cost and speed advantages. If the project has not been established,a project can be helped. The buyer can also use his experience in purchasing materials in service purchases. Demobilization The field crews deliver the equipment or tools that have remained unsold from the orders they have given during the project to the central warehouse at the end of the project. When they deliver it, they have to give a list of features and quantities but they do not observe this requirement in the whole field. Because the materials being delivered are both mixed and unlisted, the logistics unit is experiencing significant time loss in identifying and decomposing such materials. This problem appears to be a serious problem especially for buildings and equipment to be re-established. The support for the logistics group will be of great value especially if the same project group receives the materials sent in the next project again. Scrap material management Various materials taken during the project are released to the disposal due to damage or necessity reasons. Since this process continues throughout the project, there are various troubles about follow-up. The main reason for the troubles is that the garbage material is processed without being contacted by the logistics unit of the material being released. There is the possibility of selling scrap materials because of the lack of contact with the logistics unit, unfortunately, they cast away (Conscious behavior that is contrary to general morality is out of the question.). The amount that can be obtained from the sale of scrap materials can be in the order of hundreds of thousands of dollars. Scrap materials need to be addressed sensitively in order to recover the costs incurred and to provide the company with substantial cash income. May 4, 2016 - Istanbul

Valuable documents Various documents are supplied from the suppliers during the purchase. Some of these are delivered to the accounting unit (Delivery note, original invoice, etc.) and some are archived by the purchasing unit (certificate, manual, etc.). If the documents are categorized according to the type of valuable documents ( manual, conformity, MSDS, health compliance, etc.) and scanned with description and dates ( certificate date, expiry date, etc.) on the ERP system, can be acted on for the date of certificate finished materials. Corporate memory Experiences in various projects and/or units need to be spread throughout the company. The following example will help clarify the subject; "The programs downloaded from the links on the internet during the Pocket PC period were installed from the outside of the phones and this was very troublesome. In addition, when new versions of applications were released, it was necessary to follow up and repeat the same process each time. Thanks to the level of experience and knowledge Apple has gained on the laptop, Apple has produced iPhone and iPad models. And the AppStore application was first developed in iPhone models. The Apple company has solved the problem of installing and updating the application on the Pocket PC board with the AppStore application, and it has revolutionized the industry. Later, it applied to iPad models with the same infrastructure. Many applications, such as this one, were only available in iOS operating systems. Thanks to the level of experience and knowledge Apple has gained on the laptop, Apple has produced iPhone and iPad models. And the AppStore application was first developed in iPhone models. The Apple company has solved the problem of installing and updating the application on the Pocket PC board with the AppStore application, and it has revolutionized the industry. Later, it applied to iPad models with the same infrastructure. Many applications, such as this one, were only available in iOS operating systems. But the new developments in the models with this iOS operating system that it produces have not been transferred to the Laptops. Recognizing this, he developed the AppStore application within the breakthrough MacOs. In other words, he turned the experience into a cycle within the institution. As a result, corporate memory was spread across all units. This gave the company a lot of added value. " By way of this example, corporate memory should be spread throughout the company as composite containers. Experienced experiences should not be confidential and circulated within the organization. The team should be the central quality control group that will play a leading role in the coordination of the experience cycle. Cross-trainings of intra-project and inter-project units Mutual training in all project units (and possibly central units) in the form of intra-company presentations (or in different forms) will be very useful in terms of developing intercommunication. At this point, each unit will be able to empathize and understand the problems of one another, and chain problems can be avoided. Preventing the problem is easier and less costly than solving it after it happens. By taking this one step further and cross-training between projects according to the same understanding, the number and level of sample applications will increase. Participation in fairs in the sector Following the innovations in the sector, the presence of currently working suppliers in the sector and the search for new suppliers is vital for the development of the purchasing department. For this reason, it is important that purchasing unit employees participate in fair organizations organized at certain intervals in the sector and in different cities. In other words, the exhibition organizations will also make a significant contribution to the development of the supplier's guide. May 3, 2016 - Istanbul

Contracts Purchasing unit employees should have sufficient knowledge of contract matters, especially managers. In this way, both a stronger stance can be exhibited in the proposal and negotiation phases, and plenty of problems can be avoided during the contract phase. Some issues are not brought to the agenda by the suppliers in order to have an advantage in their hands. The supplier who is winning the bid tries to provide advantages by bringing these issues to the agenda during the contract ( For example the responsible party and the way to be followed when the expiration date is not enough, to whom the transportation cost of non-invoiced goods belongs, the solution of the problems that can be encountered in the provision of accounting documents, etc.). In order to avoid such problems, it would be very useful to provide in-house contract training for procurement unit employees. It is also beneficial to have an up-to-date question bank and checklist for any problems encountered or encountered. Contracts are not active but active, and they must be alive until the end of the purchase. Whether or not the terms of the contract are met can be up to date thanks to the milestones that will be put in place (date when the material is ready, dates of the transport parties, date of the certificate, etc.). Of course, these data are not very healthy by writing on paper or on any agent. Adding a menu to the ERP system and entering contract information such as the above mentioned tender information into the ERP system and inserting the signed document into the system will play an important role in active contract control and follow-up and will be of great benefit. Even the best contract, if the content is not well understood, well-elaborated and not followed up well, will be limited in its effectiveness and even the possibility of damage is strong. Supplier guide The general understanding is that the supplier list is updated only by the central quality control group. The company's general supplier list must be on the ERP and must be accessed independently of the projects. The supplier list in the ERP System should be company-wide. If only one person is allowed to add a supplier in each project (for example, an authority from the accounting department), the creation of a waste list is also avoided. The addition of vendors over the tax number rather than the name will also prevent duplicate data entries. Blocking of the red-drawn supplier is not possible immediately in the current system. However, if the relevant units check the supplier list in the central quality control group at uncertain intervals, they can be prevented. Operation is entirely passive control and is not healthy. Thanks to the availability of a supplier-wide list of suppliers in the ERP System, red-drawn suppliers sent to the quality control unit in an approved form will be blocked on the whole company. In this way, the active control can be switched on. Suppliers are a business partner in a sense and the risky supplier is also a risky business partner (Nebol, January 2014). It is necessary to have a detailed guide to the suppliers. Such supplier guidance is also required to be linked to supplier evaluation reports. Just as existing suppliers are guided, the same list of potential suppliers to be explored and appended to the evaluation report will be very useful in the long run. The continuous growth of the detailed supplier list within the ERP System will provide great comfort and confidence for projects that will start later in the same region. It is necessary to establish a strong supplier guide that is constantly developing throughout the firm and the entity will add great value to the company. Supplier site visits Supplier site visits are made spontaneously rather than within a specific program and procedure. Thanks to the sector and/or product group based supplier visit reports to be added to the procedure, good preparation is made with the question bank which will be prepared as follows, as well as the mentioned visits can be recorded and put into the ERP system and checked back retrospectively. The supplier may be able to withdraw, check and update the previous report from the system during certain periodic visits. Sample question bank; Address of the company Competent persons and titles Company owner (Private / Corporate) Year of foundation Personal number Stock volume Stock status Material procurement organizations Delivery times Terms of payment Working days and hours Information on the transport status of submitted materials Transportation insurance procedure Pricing to be applied to the sample The persons, complaints, and delivery style of the complaints Registration of order records Recording of sales information Delivery status of product certifications (Included with product / Also) Procedure for return, defective or defective product Delivery procedure for delivery notes and other accounting documents etc ... Large and strategic suppliers to be invited to the firm As the size of the supplier increases, face-to-face communication is communicated electronically and by telephone. This is a general reaction of large firms. Large and strategic suppliers come to the company to meet face-to-face with project management and navigate the building site, the infrastructure will be of great benefit in establishing solid trust-based relationships. In general, these types of visits are made by the supplier company but it must be encouraged by the purchasing units. The visits of the suppliers also aim to determine the persons to be collected by the supplier company for internal intelligence. This can also be avoided by meaningful messages from the purchasing department manager. Supplier manual A supplier's handbook, in which suppliers are provided with summary information about the company, the project, and the purchasing unit, will be very useful (Erdal, October 2011). Sample content; Short history The location of the procurement unit in the project organization Company quality policy Completed projects (brief information) Owned certificates Supplier performance evaluation criteria Expectations from suppliers (In this section, what should not be done by supplier) etc ... The fact that this book is printed in PDF format, as well as printed, will give the company a reputation for expressing its dedication to the subject. If it is sent to the suppliers to be worked on, it will have significant contributions in short and long term. Short term contributions; • Trust will be created in the new supplier (especially in the new region) • Once the expectations and evaluation criteria have been established, suppliers will know how to behave from the very beginning and their attitudes will change accordingly. Long-term contributions; • Begin with the supplier manual and continue with the supplier performance appraisal reports, the enterprise view will be acquired and the field dominance will be gained in the negotiations. References Erdal, M. (2011 Ekim). Satınalma ve Tedarik Zinciri Yönetimi (2. Baskı). İstanbul, Türkiye: Beta Basım A.Ş. Nebol, E. (2014 Ocak). Tedarik Zinciri ve Lojistik Yönetimi (3. Baskı). İstanbul, Türkiye: Beta Basım A.Ş. May 2, 2016 - Istanbul

Purchase handbook Purchasing units employees usually go through this job by chance (Ghamami). For this reason, it is necessary to give detailed information about processes, organization structure, things to be done, things that should not be done (For example; bargaining and meeting strategies) for every new participant. By this means, differences in understanding and functioning between projects will also be eliminated. The creation of a purchase handbook that sets out the general rules and strategies, excluding purchase procedures and procedures, will result in both the above issues and a significant contribution to the purchasing units throughout the company with the idea basket to be created when the handbook is prepared. At the same time, the study should be included in the ERP system. Unplanned orders Firms allocate a significant portion of the project budget for the materials to be purchased. Here the economic contribution is provided by planned purchase. (Nebol,January 2014) Since field teams and purchasing units do not share the same goal, field teams are often late to order. They put extraordinary pressure on the purchasing unit by giving them the admission deadline information of left the unplanned order. The pressure generated by unplanned purchases can both prevent lower prices and disruptions due to less time spent on other orders. The resulting stress can adversely affect the efficiency/performance of both sides. In order to reduce these bottlenecks the most, purchasing units are in the process of getting information about orders from within the field and / or keeping a minimum stock for some materials. But it is not possible for all these materials. Unplanned ordering directly impacts purchasing and inventory holding costs in the negative. A common will to create a solution. Orders canceled by field teams, in the same way, break the power of the purchasing unit in the suppliers and cause significant material damage in the long run. Broken communication among other units The close cooperation and trust environment established with the suppliers as a result of long and difficult processes can easily be damaged by the problems caused by the purchasing authority or the administrator's mistakes or other units. The understanding of "what money we are telling you!" Results in the failure to work with small suppliers or with suppliers who are obliged to work. Therefore, the role of trust and close relationships is important. In the market, there are few suppliers in some product groups (work safety materials, ready-mixed concrete, power tools, etc.). For this reason, the relations with the suppliers must be kept at a constant level. Erroneous, urgent or canceled orders with incomplete information force the purchasing units to make mistakes. As a result of the stress, the lack of experience or the inability to manage well due to inconvenience, the relationship with the supplier may be worse than it first started. This problem becomes even more important for projects with long and / or high purchasing budgets. To prevent this, the purchasing unit employees are surveying the field teams with certain indistinct intervals whether there is any need. Lakin does not always lead to the desired result. The chain is as strong as its weakest link, and it will have a positive impact on the costs of the solution. Quotations (BID Tabulations) In some cases, contact with many companies is being made during the bid collection phase, which is the stage prior to the order's turn to buying. Technical knowledge is gaining importance in some special material groups. The detailed information about the material will be more easily accessible thanks to the cross-function groups to be created from the relevant units in the special material purchases. Transfers of quotations to BID Tabulation form are done in Excel environment. As a result of the additional workforce, the staff of the unit avoids preparing this form as much as possible. Because information such as material and company names already existing in the ERP system is entered again and again. However, thanks to an additional module to be added to the ERP system, BID Tabulation can be prepared on an order basis, so the information to be entered will be only information such as price and term. After the digital approval of the top management, the process will be finalized without the need for any printed document. Furthermore, with the total amount limit based on the invoice to be entered into the ERP system, it is necessary to prevent the submission of purchases without BID Tabulation. Of course, in the meantime, the bills must be shredded in order to overtake the system. References Ghamami, O. (tarih yok). Omid Ghamami. Nebol, E. (2014 Ocak). Tedarik Zinciri ve Lojistik Yönetimi (3. Baskı). İstanbul, Türkiye: Beta Basım A.Ş. May 1, 2016 - Istanbul

In order to be well planned tomorrow, today and yesterday must be properly and well reported. The KPI (Key Performance Indicators) system is not sufficiently valued by procurement units. The instant situation is reported from the system and it is observed that it is possible to see the current situation, to check it according to it and then to act on it. This system has insufficient and incomplete aspects. The concentration of high budget buyers is generally based on personal preferences rather than on a system. The inclusion of this (such as the ABC Analysis) in the system will be of great benefit in terms of using time efficiently and focusing on the right suppliers. Key Performance Indicator Reports are comparable reports that translate information into goals, include targets, approach, and tendency to the target, provide micro-macrostructures to see macro-microstructures, provide performance motivation, inform about what we do not know and/or do not realize. It enables automatic Key Performance Indicators to be automated as long as they can be reported as needed, not for a long period of time at the end of the term, and provides immediate control (both in terms of computer technology and presentation stability). Of course, KPIs do not have to cover everything. Simple and effective. Since KPIs are also projections of the strategy, they should show a common goal with other groups. For example, the purchasing department would like to keep the minimum stock amount excess, but the cost control unit wants the minimum stock amount to be at a minimum to keep the expenses to a minimum. By combining these two goals, it will be of great benefit to establish a KPI system that will reduce the cost of holding stock and at the same time ensure that the goods are at stake. A simple and understandable KPI system with a targeted, measurable and achievable target from the value will positively affect the procurement unit. For example, the appearance of several designated target displays in the work environment will affect motivation and performance positively. Sample KPI titles and objectives; Percentage of purchases based on supplier classes (Preferred, approved, etc.) What kind of companies are mostly working with Open order amount per period Seller performance Amount of pending waiting for the period, total periodical receiving rate Increase cash flow contribution The period-based stock amount, total periodical receiving rate, Increase cash flow contribution Order response time Seller response performance Delivered on the agreed date Supplier performance delivery performance Purchase amount per product group Which groups will be given more importance Number of active suppliers per period Overview Minimum stock amount per product group Stoke holding cost performance Number of suppliers evaluated on a periodic basis The attention of the purchasing department to the evaluation Supplier performance trend chart Control of the progress of the scores of the suppliers according to the seasonal curve etc. May 6, 2016 - Istanbul