... value of outsourcingto ail companies. 132. HARVARD BUSINESS REVIEW ... lay out a practical strategic framework to guide companiesthrough the transition.
Nov 4, 2011 - Construction Strategic Sourcing, Risk Management, Construction ... Business process redesign to allow contractors to use KU contracts.
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Sako (1992) reported that Japanese car manufacturers lamented the difficulties they had in breaking up existing relationships with suppliers (and switching to new suppliers). Yet, the recent years have witnessed a growing trend of companies consolida
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perspective. Finally, section 7 concludes and outlines future research. 2 Strategic sourcing as tactical spend management. Strategic sourcing is traditionally seen as a ... Procurement. Fig. 1. Procurement process. The current techniques for strategi
Jul 22, 2008 - to complex data mining and analysis. â¢ Standard Reports. â¢ Custom Reports. â¢ Ad-hoc Queries. â¢ Data Summarization. â¢ Vendor Utilization.
Mar 24, 2009 - convert legacy bidder records and track bid events the decision was made to use. PeopleSoft Strategic Sourcing for that purpose even though ...
Limited emphasis on end-to-end category management philosophies. â¢ Failure to ... Select Suppliers. Integrate. Suppliers. Benchmark. Supply. Market ... six times higher transaction ... Model. Preferred. Provider. Model. Performance. Based/Manag ed.
for long term procurement .... LTC = Long Term Contracts PACE = Procurement Automated Contracting Evaluation .... Fleet Automotive Support Initiative (FASI) -.
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Apr 8, 2011 - Calhoun: The NPS Institutional Archive. DSpace Repository. Faculty and Researchers. Faculty and Researchers Collection. 2011.
Dec 31, 2007 - strategic response to declining firm performance. .... H1d: The greater the decrease in firm's debt management efficiency, the higher will be the ...
BEWARE OF INTEL INSIDE. (Regardless of your industry). 2. MAKE/BUY IS NOT ABOUT WHETHER IT IS. TWO CENTS CHEAPER OR TWO DAYS FASTER. TO OUTSOURCE VS. INSOURCE. 3. SUPPLY CHAIN DESIGN CAN DETERMINE. THE FATE OF COMPANIES AND INDUSTRIES,. AND OF PROFIT
Mar 24, 2011 - Sourcing strategy is therefore an integral part of a firm's business strategy. Both the ... Without further ado, let us commence with the presentation of the findings. The remainder of this .... development in terms of time to market,
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Mamoun Alazab, Sitalakshmi Venkatraman, Paul Watters and Moutaz Alazab (2013). IT Security Governance Innovations: Theory and Research (pp. 293-315).
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Jan 17, 2018 - Establishing Agreements that meet the university's mission of teaching, research ... Form Project. Team ... Customer feedback. â¢ Do we have an ...
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will be forced to adapt to avoid losing position and profit to their more efficient competitors, customers, and suppliers. Evolution: From Buying to Category. Lifecycle Management. History. Throughout the evolution of the market, some companies have
Category Management - Strategic Sourcing Dave Porter
www.pmms-group.com Consultancy · Negotiation · Skills Development · Executive Sourcing
Category management is a process which relies on cross functional teamwork to generate procurement outcomes that fully satisfy agreed business needs.
– Categories group products and services together based on the ability of the market to supply not on the basis of organisational boundaries. •
BUT - this has been the goal of the procurement profession for many years – what is so special about category management? – Extent of engagement and teamwork with stakeholders for all expenditure with suppliers. • Not simply allocating categories/commodities to procurement team members – Governance process which crosses organisation boundaries. – Depth of category specific knowledge and expertise – market & technical. – Emphasis on planning and use of analytical tools.
Category Management Process Key Components Establish team & governance structure
Gather data & analyse internal & market
Identify & quantify opportunities
Comprehensive category plans addressing all sub categories
Category plan identifies all opportunities within a category along with the anticipated means of achievement. For simple procurement, it may also define the procurement strategy.
Develop procurement strategy options
Implement preferred procurement strategy
Specific strategy for procurement of one or more sub categories
Low value simple procurement may simply involve implementation of the conclusions of the category strategy e.g. use a collaborative framework/contract, change the specification and re-negotiate terms. More detailed investigation is required for high value complex procurement. This is often referred to as Strategic Sourcing or Procurement Strategy.
What is being purchased, why and how Existing Suppliers What works well Problems/issues
• A number of organisations bought milk individually or in small groups for their customers. • Fairly wide range of existing suppliers encompassing national, regional and local suppliers • Milk was delivered on a daily basis in the morning. • Customers were happy with the service provided but all organisations were under significant pressure to reduce cost.
• Organisations sought to reduce cost through collaboration.
What is being purchased, why and how Existing Suppliers What works well Problems/issues
• Organisations aggregated demand within a framework for milk. • Framework was divided into fairly large geographic lots with tenderers able to tender for any lot • Customers wished to retain the same service (daily delivery by 10am) with all ideally paying the same price. • Customers were unwilling to accept less frequent delivery due to limited back room storage. • Customers’ wishes became the objectives for the procurement.
What actually happened? • Large national supplier won all but one lot, which was won by a large local supplier. • A few organisations then withdrew from the framework to run smaller more local competitions. • Service delivered successfully but prices are little different to those previously paid. • Local competitions delivered prices a little below the framework prices. • Requirement to deliver small volumes to all locations by 10am each day effectively reduced the market to one supplier (primary supplier). • Primary supplier was being investigated by OFT for price fixing along with supermarkets and other large dairy suppliers.
Milk has a shelf life of up to (say) 8 days – Do we need daily delivery - constraint is lack of back room storage – What if we stored the milk in the front room - how could it be done? – Do we need to store the milk in small separate containers?
What might happen if the need was expressed as: – Most cost effective provision of a specified volume of milk to each customer at each location by 10am on a daily basis subject to no backroom storage.
Milk suppliers may still offer daily delivery
Dispensing services suppliers might provide and service vending machines in the front room with less frequent deliveries for the more remote and smaller locations
Vending machines could dispense other products, potentially generating sales
The News Dec 2007 - OFT welcomes early resolution agreements and agrees over £116m penalties regarding collusion between supermarkets and dairy suppliers incl the primary supplier. Legal proceedings subsequently dropped.
Nov 2009 - Primary supplier first half (April to Oct 2009) profits leap by 81%.
Sept 2010 - Primary supplier issues profit warning - intense competition and rising plastics (oil related) costs are blamed. March 2011 - Primary supplier warns of higher prices driven by higher input prices including 2 increases in 2 months (up 8%) to farmers. Vows to push for higher price from supermarkets. May 2011 - Competition hits primary supplier profits which are down 30% - all major retailers had put milk contracts out to tender and that had increased competition and squeezed margins although volumes had risen as a result. Jan 2012 - Primary supplier agrees to takeover by major European dairy at 60% premium on current share price and 25% discount on 2010 high. By this time, primary supplier has 30% of UK milk market.
How quickly things change - plans must be kept up to date 19