Strategic Sourcing

Strategic sourcing is a procurement process that involves the systematic and comprehensive evaluation and selection of suppliers based on their ability to meet the needs of the organization. It is a key component of supply chain management and is designed to help businesses reduce costs, improve efficiency, and increase competitiveness.

The strategic sourcing process typically involves several steps, including:

1. Defining the scope of the project: This includes identifying the products or services that will be sourced and determining the specific requirements and criteria that suppliers must meet.
2. Identifying potential suppliers: This involves researching and evaluating potential suppliers based on factors such as quality, cost, delivery, and responsiveness.
3. Requesting proposals: Once potential suppliers have been identified, the organization can request proposals or bids from them, outlining the specific products or services they can provide and the terms and conditions of the proposed relationship.
4. Evaluating proposals: The organization will then review the proposals and evaluate the strengths and weaknesses of each supplier based on the criteria established in step one.
5. Selecting the supplier: Based on the evaluation of proposals, the organization will select the supplier that offers the best combination of quality, cost, and other factors.
6. Negotiating the contract: Once a supplier has been selected, the organization will negotiate the final terms and conditions of the agreement, including the price, delivery schedule, and other details.

By following a strategic sourcing process, businesses can ensure that they are working with the best possible suppliers to meet their needs and goals. This can help them reduce costs, improve efficiency, and increase competitiveness.

• “The most important trip you may take in life is meeting people half way.”  ~ Henry Boyle
• “You have to persuade yourself that you absolutely don’t care what happens. If you don’t care, you’ve won. I absolutely promise you, in every serious negotiation, the man or woman who doesn’t care is going to win.”  ~ Felix Dennis
• “Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.” ~ Sun Tzu
• “We tend to think that, in a traditional organisation, people are producing results because management wants results, but the essence of a high-quality organisation is people producing results because they want the results. It’s puzzling we find that hard to understand, that if people are really enjoying, they’ll innovate, they’ll take risks, they’ll have trust with one another because they are really committed to what they’re doing and it’s fun” ~ Peter Senge
• “What business strategy is all about-what distinguishes it from all other kinds of business planning-is, in a word, competitive advantage. Without competitors there would be no need for strategy, for the sole purpose of strategic planning is to enable the company to gain, as efficiently as possible, a sustainable edge over its competitors.” ~ Kenichi Ohmae
• “The reason most people never reach their goals is that they don’t define them, or ever seriously consider them as believable or achievable. Winners can tell you where they are going, what they plan to do along the way, and who will be sharing the adventure with them” ~ Denis Watley
• “Negotiation is not a policy. It’s a technique. It’s something you use when it’s to your advantage, and something that you don’t use when it’s not to your advantage.”  ~ John Bolton

“Strategic sourcing in the simplest terms – leveraging all resources to get the best value for the company.” ~EverythingSupplyChain.com

“A well trained procurement organization can add major dollars to the organization through cost savings.” ~EverythingSupplyChain.com