Contract closeout is a vital part of the cooperation between partners. It happens when a specific agreement has met all terms of the agreement between parties (Guth, 2018). It also presupposes administrative actions to ensure proper closeout and finalize all payments (Guth, 2018). First, SpaceX should ensure all invoices are paid and price revision is completed. It is demanded to avoid financial issues and observe the contract (Guth, 2018). Moreover, a contract audit should be performed to check if all parties’ demands and duties are met. SpaceX cooperates with multiple suppliers providing raw materials to the company, meaning that the finalization of payments might become a complex issue because of the necessity to consider all existing conditions.
In such a way, SpaceX should complete its closing statement, submit the final invoice, and review the contract funds. It will show that all parties have observed the central demands and their duties and provided the demanded services and payment. After all these procedures, SpaceX should start finalizing payments following its current reports and procurement plans. Finalization can occur in several stages to check every aspect and avoid mistakes preconditioning the poor outcomes (Guth, 2018). Following the checklist with the suggested points, SpaceX can perform an appropriate contract closeout and avoid claims or deterioration of the corporation’s image.
Maintaining Supplier Performance
SpaceX critically depends on raw material suppliers as the company needs stainless steel, titanium, cryogenic liquid oxygen, and RP-1. The company uses Scanmarket’s Supply Base Management (SBM) to find information about all possible suppliers and use it to form alliances. Moreover, it has strict demands for sustainability and other performance indicators, meaning that there is a competitive tendering for suppliers helping the company to select candidates meeting its requests (McCormick, 2018). At the same time, engaging in the cooperation with a partner, SpaceX focuses on the creation of trustful and respectful relations that will help both companies to benefit from the collaboration.
In such a way, there are specific Key Performance Indicators (KPI) that are applied to companies to determine whether they can be viewed as suppliers. These include the quality of materials, technical performance of a unit, vast production capabilities, design, innovation and management expertise, on-time delivery commitment, financial sustainability, customer service, reliability, and reactivity. Applying these KPI to candidates, SpaceX acquires a chance to select partners meeting its criteria to performance and helping the brand to evolve. Moreover, the existence of detailed KPIs helps to ensure there are no flaws in supply chain management and that demanded raw materials are delivered in time.
Supplier performance can be measured by using specific approaches. First, the SMB database containing information about all possible contractors should be assessed to ensure that SpaceX possesses all data needed to conclude about the possibility of cooperation with a particular actor. Using this evaluation tool, the company can attain the best prices combined with performance. Another possible way to measure supplier performance is to analyze their previous and current results and reports to determine whether there is progress and a company can be trusted. Using the criteria and these specific measurement tools, SpaceX can select the most attractive partners and benefit from the cooperation.
Memo to Procurement Officer
- To: Procurement Officer
- From: Student Name
- Date: Month, Day Year
- Subject: Procurement Plan
It is vital to use the proposed plan of cooperation with suppliers because of several factors. First, it offers relevant information about contract closeout that can be used to attain desired outcomes. The existence of a specific checklist helps to ensure that all vital aspects are taken into account, and there are no issues that might precondition the emergence of the conflict in the future (Meredith & Shafer, 2019). Moreover, it considers the current model used by SpaceX to work with its suppliers. For this reason, it is recommended to finalize payments following the method offered above.
Second, the plan provides many details about the current paradigm used by the corporation to work with its suppliers. SpaceX emphasizes the fact that it values open, trustful, and long-term cooperation based on mutual respect. For this reason, being one of the leaders in the sphere, the brand has its own criteria list and tendering system to ensure that the partners meet the criteria vital for supporting its excellent functioning. The use of the SMB database is one of the advantageous options as it contains credible data that can be used for improved decision-making regarding the choice of suppliers.
Finally, the advantageous nature of the proposal is explained by the fact it is aligned with the strategy used by the firm at the moment. SpaceX critically depends on the on-time delivery of raw materials and their high quality to guarantee that its final products meet the safety demands. For this reason, the offered criteria, methods of working with suppliers, and approaches to measuring performance correlate with the current vision and help the company to preserve its advantageous position and evolve (Meredith & Shafer, 2019). Observing the given plan, the company can improve its procurement management and ensure that its partners can be trusted and viewed as long-term suppliers vital for the company.
Guth, S. (2018). Project procurement management: A guide to structured procurements. Independently Published.
McCormick, J. (2018). The first-time manager (17th ed.). AMACOM.
Meredith, J., & Shafer, S. (2019). Operations and supply chain management for MBAs (7th ed.). Wiley.