Supply management business plans

Add comment November 14th, 2006 David Bush - Iasta

There is a recent article available from Inside Supply Management, written by Joseph L. Cavinato, which outlines the roles of supply professionals in overall organizational performance. Growth in supply management is broken down into the following three points:

• Increasingly supply professionals see their roles today as enhancing the organization’s overall performance (financial, competitive, service and so on) rather than narrowly performing administrative buying services.
• The contributions are measured along a spectrum starting with price, naturally, and continuing in the forms of wider margins, lower overhead, increased cycle times, faster time to market, reduced asset base and value through working with the supply base.
• There has been a shift from reacting to stakeholder demands and needs to taking the initiative to identify and seek mutual product or service enhancements and organizational performance improvement. Those within the field know, see and understand the nature of supply, suppliers, markets, and opportunities and threats to greater degrees than those within many other groups in the organization. And, this position of supply manager offers a significant organizational strength.

All of the above points are deeply supported with e-Sourcing software for efficient communication and analyzation which help supply professionals execute on these concepts. We recently completed an internal business case for sourcing automation using client experiences that do not utilize reverse auctions and found very quantifiable correlations between e-Sourcing technology and success with supply management principles.

So, a question I might pose, is about the chicken and egg. What came first? Did software and technology tools elevate supply management to a higher level of power and influence or did the natural progress and evolution of the profession create the demand for such tools? The easy answer is that they probably happened at the same time and concurrently. This is also - most likely - the correct answer. As new technologies became available, they were embraced and adopted, leading to the heavy demand for additional functionality. Classic supply and demand.

It has been very intriguing to watch the evolution of supply management, even over the very latest 5-10 years. The sophistication of the people and usage of technology, in addition to the importance of their presence, has been constantly changing and improving.

Entry Filed under: General, Supply Management Best Practices, Technology