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Strategic Sourcing overview | the 7 stepsMethodology, Purchasing, Strategic Sourcing --- 2006 Jean-Philippe Massin, 12,437 views
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Strategic Sourcing methodology is used to identify, examine, select and implement sourcing alternatives for a specific Sourcing Group (SG). It encompass the whole process for evaluating, selecting and aligning with supplier(s) to achieve operational improvements and support overall strategic objectives. Strategic Sourcing focuses on total costs and not just the purchase price; Strategic Sourcing assists an organisation by gaining a good understanding of its requirements, knowing how it must map to the existing supply market, and then develop a plan for both short and long-term objectives. There are many ways to segment a strategic sourcing program into a step by step approach. One is to divide it into seven steps as shown in the diagram below.
Key points to know are following:
- The Strategic Sourcing methodology assumes that Sourcing Groups (SGs) have already been defined, either through a Sourcing Opportunity Assessment or through any other mean.
- The methodology is designed to be carried out by an “SG team,” comprised of people with a broad range of backgrounds, playing several roles. For example, the SG team typically would include a decision maker, facilitators, technical experts (e.g., supply market experts, engineers) and other cross-functional members as representatives of the user community.
- The methodology provides general guidelines in areas such as finding potential data sources, identifying the appropriate depth of analysis and selecting the applicable sourcing and negotiation approaches.
Each step will be detailed in future posts.
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2 Pings to “Strategic Sourcing overview | the 7 steps”
6 Responses to “Strategic Sourcing overview | the 7 steps”
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1. Iryna Says:
April 10th, 2008 at 3:04 pmYour topic
“How to Qualify a Sourcing Group | SSM’s Step 1/7 – Strategic Sourcing ” does not open unfortunatelly… -
2. Iryna Says:
April 10th, 2008 at 6:55 pmHello? I really need to know more details about each step. How I can get it????
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3. The Doctor Says:
April 10th, 2008 at 7:29 pmTry:
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4. Jean-Philippe Massin Says:
April 17th, 2008 at 8:35 amShould be ok, did you try that: http://www.massin.eu/2007/04/23/how-to-profile-a-sourcing-group-ssms-step-17/
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5. Donna Lacka Says:
July 31st, 2008 at 3:44 pmEach step will be detailed in future posts. When will these be posted or where can I get the book mentioned above.
Thanks
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6. Donna Lacka, C.P.P., C.I.M. Says:
September 17th, 2008 at 2:01 pmI have now read alot of very valuable information on the 7 Step Strategy from this site and have found it vey informative. I have used this Strategy in my professional life with great success. For newcomers to the Procurement field I would suggest that you drink in as much information as you can on this subject in will be useful to you in your career. The negotiation strategy is key in the the seven steps and again I would suggest that you look into as much information as you can on this subject as possible as well. Great site!
March 30th, 2007 at 7:44 am
[...] critical success factors (CSF). As you will see, it is tightly linked to enabling the 7-step methodology I always refer [...]
April 23rd, 2007 at 3:34 pm
[...] a previous post, I have defined the 7 steps of a robust strategic sourcing methodology (SSM). My intention is now to provide more details about each step. Step 1 – qualifying a Sourcing [...]