Benefits of e-Sourcing

Apr 18

Purchasing, eSourcing --- 2006 Jean-Philippe Massin, 3,283 views Add comments

AberdeenGroup has listed the key benefits of e-Sourcing in its report ‘Secret of e-Sourcing success’ published in 2004. Here is the abstract matching challenges with key benefits:

Challenges	Benefits
High material costs	14.3% cost savings,
Sourcing cycles average 3 to 4 months	Cut sourcing cycles in half,
High sourcing costs	Reduce administration costs by more than 60%,
Long time-to-market cycles (new product)	Cycles shrinked by 10-15%,
Inconsistent sourcing procedures and skills	Improved ability to standardize on sourcing best practices. Enhanced knowledge capture and transfer,
Inability to effectively exploit market changes	Enhanced market knowledge and improved market transparency,
Unable to exploit low-cost country sources	Dramatically improve ability to identify and negotiate with new sources of supply,
Transactional and combative supply relationships	Detailed RFx and enhanced collaboration clarifies expectations and improves supply relations. Cycle times savings free up buyers to build and develop supply base,
Inadequate spend under management	Process efficiencies empower application of strategic sourcing to more spend,