Opinion ID: 1298687
Heading Depth: 1
Heading Rank: 3

Heading: Purchasing

Text: Examination of Amoco Corporation's different operational areas sheds light on the extent of centralized management. We turn first to purchasing. APC and AOC each operated its own purchasing department and APC and AOC each made its own decisions around how they ran them and how they staffed them. No single purchasing plan applied to all of the subsidiaries. However, the general manager of purchasing for Amoco Corporation reviewed the operations of the subsidiaries' purchasing departments with the goal of enhancing the subsidiaries' operations. Moreover, Amoco Corporation implemented a general policy for the subsidiaries to follow. The policy was directed at procuring goods and services at the most effective price and minimizing excess supplies. In their independent operations, the subsidiaries followed this policy and thereby accessed the capabilities of Amoco Corporation to improve cost effectiveness. Amoco Corporation's purchasing department also developed master contracts to assist the individual subsidiaries in purchasing their goods and supplies.