Final answer:
The part of the supply chain misalignment focused on short-term planning and measured by purchase price variance relates to procurement. This metric is particularly critical under high and variable inflation, which can cause market adjustments to be erratic and result in surpluses or shortages.
Step-by-step explanation:
The part of the supply chain misalignment that is focused on the short-term planning horizon and is measured by purchase price variance is typically associated with procurement and sourcing activities. Purchase price variance is a critical measure in supply chain management as it indicates the difference between the actual price paid for an item and its planned or standard cost. This variance becomes particularly significant in the context of high and variable inflation, which can weaken the incentives for an economy to adjust to changes in prices, leading to erratic market adjustments and a greater chance of surpluses and shortages.
Understanding the difference between shifts of supply or demand and movements along a curve is essential for effective short-term supply chain planning, as it can impact procurement strategies and contribute to purchase price variance. Short-term supply chain activities need to be carefully aligned with long-term strategies despite the problems of long-term planning posed by high inflation and market volatility.
Operational misalignment refers to the situation where there is a mismatch between the supply chain's operational plan and the actual execution of that plan. This can result in inefficiencies, such as increased costs due to purchase price variance.