Cluster-Based Procurement Management Optimization Strategies for Telecom Companies

Equipment procurements are frequent and fundamental works for telecom companies since their capital-intensive features, then how to optimize procurement decisions to reduce relative costs is critical for their cost strategy and development. From perspective of Life-cycle-cost (LCC) theory, this paper conducts an empirical study on cluster-based procurement management optimization strategies of a telecom company in China. The paper composes of four sections; Section 1, introduction. Section 2, methodology, introduces LCC theory and clustering method applied in the paper. Section 3, empirical analysis, through a case study, the paper analyzes specific procurement strategies for the selected telecom company based on clustering results. Section 4, conclusions, focus on improving procurement management for telecom companies, the paper proposes three recommendations.