By Strategic Sourceror , February 6, 2014, Stategicsourceror.com
1. Segment the supplier network
Technologies such as big data analytics are allowing companies to adopt more targeted decision-making practices, moving away from broad-stroke approaches to marketing, sales and other key operations and instead creating more personalized experiences for customers, leads and end-users. These same techniques can be adapted to procurement strategies.
In a column for EBN, Avnet’s Senior Vice President of Global Supply Chain and Strategic Accounts Lynn Torrel pointed out the benefits of a segmented supply chain management model. Essentially, this approach sets unique goals and methods for each sub-area of the supplier network. The lines to determine segments may be drawn along geographic borders, supplier type or other factors. Though the technique may appear to introduce complexities, it actually helps simplify procurement.
“Through segmentation, OEMs can better align their resources so that they are not, for example, spending money delivering commodity products ahead of demand or holding up production waiting for custom parts to arrive with a consolidated shipment of standard products from overseas,” Torrel wrote.
2. Work alongside competitors
Firms might also consider making strategic partnerships with competitors for shared procurement initiatives. According to Supply Management, NH Hotels Chief Procurement Officer Salvador Serra de Paz recently discussed his firm’s joint sourcing venture with Husa Hotels at the recent Procurement Transformation Summit in London. The partnership allowed them to create a centralized channel for purchasing cleaning supplies, food, beverages and other items.
The key to developing a sourcing strategy that is both creative and effective is to ensure that it suits the company’s specific operational needs.