One of the biggest barriers to sourcing strategically is 'Just Buying' mindset. It forces us to shift our emphasis on getting things done quickly, leaving us very little time to explore innovations within and beyond our supply networks.
Why is that the case? We as organizations might be dealing with time and budget constraints, competitive pressures, market difficulties and resistance to change as contributing factors. We could also be dealing with consequential risks such as loss of revenue, production delays and safety related risks escalating it to a rush type situation. Not having something which was needed yesterday is a tough problem we face every day. That broken pump, leaking pipe, missing parts and not having experienced personnel to do the job, makes us think should we plan a strategy or just get it done right away?
What can be done? Portfolio Analysis might help us get started. We can divide our spend into 4 different quadrants and define labels accordingly. Example: Spend that is labelled strategic would mean enterprise wide, long term, 3rd-party contributive while critical on the other hand would mean not enough supply, difficulty switching suppliers and so on. The benefit of labelling our portfolio is that we can develop strategies in advance and decide how we chose to react when that broken pump situation arises. Who are our preferred suppliers we can go to, than relying on spot purchases. How much of the spend can be consolidated and sourced from fewer suppliers than many?
This gives us the power to choose and act!
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