Best Practices on Sourcing

Arriving at the best price for a defined quality of service or product is the objective of any sourcing mechanism. Organisations, big or small are faced with this constant challenge of improving the prices, enhance margins and buy better. They would want to improve relationships with suppliers / vendors and thereby create value for their customers. This involves adopting some of the best sourcing practices at the enterprise level.

Some of the suggestive best practices would be as below

1. Having an enterprise wide sourcing policy which would define the ethics, commercial and business limits of authority & the type of sourcing ( normal, RFP process, the screening density of vendors, dynamic bidding etc) to be adopted.

2. Embracing tools that would help you automate the sourcing process customized to the organization. This would include common modules such as vendor management, contract management, reverse auction tool and specific modules such as knowledge management, risk management, lessons learnt, strategic sourcing reports to enable complex sourcing decisions that help the organization to learn from its previous sourcing.

3. Implementation of these processes at the enterprise level and at business unit level (say project, department, etc)

4. Audit of these processes and monitor compliance

5. Use of Sourcing knowledge across domains, departments, business units.

6. Managing and tracking of the supply chain wherever applicable and enhancing the value of the supply chain.

Venkatasubramanian P
Co-Founder, CKO and VP-Functional Specialists

ISACGlobal