This is a six-part series unpacking the stages of true strategic sourcing.
The means to achieving success in the procurement world have drastically evolved over the years and now hinge on one’s ability to strategically source. Modern businesses demand optimal supply options for the best attainable value from a holistic standpoint. Merely analyzing price or top level attributes is no longer enough to separate from the competition.
Strategic sourcing entails digging deeper and uncovering cloaked inefficiencies, adhering to the long-term to feed the short-term, and creating more synergy between procurement and the overall company.
The first leg of the strategic sourcing journey is to ensure your department goals and philosophies are aligned with those of your company’s. Like with any division of an organization, if everyone isn’t pointing toward the same finish line, people are going to be running into each other and no one is going to emerge victorious. With regards to procurement, the decisions made here are the literal building blocks to the company’s final product. Buyers must resist the short-sided temptations of checking boxes or immediate gains and instead consider how each choice fits in the grand scheme. If shaky calls are made at this juncture, significant enterprise undertakings could eventually come tumbling down. And procurement resources and performance will surely join them.
Frequent communication is vital when properly aligning goals because changes might be being made formally and informally on a daily basis. If procurement is operating on old information, its output will be obsolete as well. And with everything that purchasing professionals are being asked to do these days, they simply do not have time to perform wasted work or backtrack to redo tasks. Buyers should also coordinate with other departments to consolidate in-house work orders, track purchases and deliveries, share intel on how vendors are performing, and be there to fill in the gaps when each other’s needs aren’t being met.
This step involves looking within the company as accurately and honestly as possible. Determine what the objectives are through scrupulous adherence to the organization’s mission, vision, and reason for being. The more everyone has these conversations, the more everyone will understand what they are doing and why they are doing it. And the more everyone’s heads and intentions are in sync, the more each cog in the company can carry each other in trying times and double-up to accomplish everyone’s goals.
Next up: Step 2- Expand your professional network and research the market