What Is the Institute for Supply Management (ISM)?

What Is the Institute for Supply Management (ISM)?

Let me explain what the Institute for Supply Management, or ISM, really is. It's a nonprofit association focused on supply management, and it's been around since 1915, making it the largest of its kind. I want you to know that it offers certification, development, education, and research for both individuals and companies in supply management and purchasing. The main goal here is to advance supply management so it drives value and gives a competitive edge. They also put out the ISM Manufacturing Report on Business, which you'll hear more about.

Key Takeaways

Here's what you need to grasp right away. The ISM is a nonprofit supply management association. It started in 1915 as the National Association of Purchasing Agents and switched to its current name in 2002. It handles certification, development, education, and research for supply management and purchasing fields. Members can get the Certified Professional in Supply Management or the Certified Professional in Supplier Diversity. Plus, the ISM releases three Purchasing Managers' Indexes in its Manufacturing Report on Business, and these are seen as top economic indicators.

Understanding the Institute for Supply Management (ISM)

Let's dive into the details. The ISM began in 1915 as the National Association of Purchasing Agents and kept that name until 2002 when it became the ISM. As I mentioned, it's the biggest organization serving supply management and purchasing professionals. By 2021, it had over 50,000 members in 100 countries. It provides services to professionals and corporations alike, with leadership made up of people active in supply management.

What does this mean for you? The ISM gives professionals certifications, career support, training, and networking opportunities. You can earn two key designations: the Certified Professional in Supply Management (CPSM), which shows top-level skills based on deep analysis of supply functions across industries, and the Certified Professional in Supplier Diversity (CPSD), which trains experts to handle supplier diversity, find innovative suppliers, and enter new markets. To keep these, you have to recertify via continuing education, work experience, volunteering, or exams.

The organization also issues its Report on Business, featuring the Manufacturing Purchasing Managers' Index (PMI) and the Services PMI. These come out monthly from the ISM's Manufacturing and Services survey committees and are reliable economic signals. There's also a monthly Hospital PMI from the committees.

Important Note

One thing to note is that professionals with a CPSM can earn up to 10% more than their peers in the industry.

Special Considerations

Supply management might seem like just buying raw materials for production, but it's more involved than that. It's a complex process where personnel handle identifying, sourcing, negotiating, and procuring essential services or goods for company operations, all aligned with leadership's directives. They also create and execute strategies for supplier relationships, hold suppliers accountable, use technology and procedures for procurement, and consider supply and demand influences.

On top of that, those in supply management and purchasing need to manage logistics for preproduction, inventory, budgeting, workforce, and keeping everything running smoothly.