In a recent conversation, my colleague Björn Stenecker he showed me an ingenious model that describes the transition a purchasing organization need to make in order to succeed with a modern sourcing process as well as assessing the needs of new roles and responsibilities.
The model is based on the fact that many purchasing organizations – almost by default, and most probably (mis)guided by tradition – focus most of their energy and effort on the negotiation phase of the sourcing process. From a historical standpoint, this is where purchasers excelled.
The problem is that although this may very well work from time to time, a modern purchasing process utilizing modern tools are more dependant upon analysis, base-lining and sourcing strategy than on negotiation skills. The success rate of the sourcing effort is also increased by the effort spent implementing and continuously improving the agreements in place.
What Björn then did, was overlap this model with graphics showing how the efforts of the purchasing organization were deployed over the sourcing process. The result was stunningly brilliant in all its simplicity. The effort curves of a purchasing organization that included commodity managers, analysts, category directors and contract experts neatly matched the optimal focus curve.
IBX - Sourcing Organization Visualized
Given the support of business developers, administrators, e-sourcing managers and a core team approach to process roll-out this type of organization can provide sustainable savings, ensuring that purchasing strategy is inline with corporate business goals and taking advantage of news purchasing opportunities.
While this type of organizational grid is nothing new; Björns model clearly displays the need for expanding the skill set to refocus the sourcing effort to maximize the impact of both a global supply chain as well as the impact of the tools that have been revolutionizing purchasing in the past decade.
