Needs Identification Vs Defining Commercial Equivalents

Describe the differences between needs identification and defining commercial equivalents and discuss why it is preferable to separate into two stages.

The initial two stages of the process of acquisition are fundamental to ensuring that the company’s needs are met effectively. Needs identification is the stage where the purchase process begins(Johnson, Lendeers& Flynn, 2010). During this stage, the organization identifies the requirements for satisfying given goods and services. During this stage, the organization also determines when and how much of the required commodity should be purchased. Once the identification process is complete, the process of defining commercial equivalents commences.

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During this stage, the organization determines the options available that could fulfill the identified needs and describes them in a way that the suppliers can understand. The organization may also define the identified needs’ commercial equivalent so as to ensure that suppliers understand exactly what is expected (Johnson, Lendeers& Flynn, 2010).These two major stages are crucial to the acquisition process. For the organization to effectively complete the process, it should ensure that its needs are correctly identified, a suitable solution established, and that the potential supplier understand what the organization needs.

Read also McGregor’s Theory X and Theory Y, Maslow’s Hierarchy of Needs Theory and the Hawthorne Studies

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