e-Sourcing, The Art & Science of the Deal

Add comment January 31st, 2007 David Bush - Iasta

Aberdeen recently published a Global Supply Management Research Brief entitled e-Sourcing: The Art & Science of the Deal that indicated that procurement groups need to prepare for the oncoming challenges of future e-Sourcing waves now in order to maintain the momentum generated by maturing e-Sourcing programs.

In particular, the research brief advises the initiation of some or all of the following activities:

• Develop advanced e-Sourcing capabilities:
     Your focus needs to move from lowest cost to highest value. Total Value Management is what it’s all about.
• Centralize e-Sourcing capabilities:
     This further capitalizes on your move to center-led organizational structures.
• Improve Supplier Discovery Capabilities:
     Also, pursue LCCS opportunities when appropriate.
• Extend your e-Sourcing Solution:
     Invest in technology and/or services to make sure your program includes spend analysis, process management, and contract management.

They also created a nice KPI chart for analyzing strategic sourcing performance -

These things are all very similar to the message leading e-Sourcing vendors have been preaching and developing for years.

The research brief also notes that you have to shift from a single focus on cost savings/avoidance to a broader management of supply availability and risk while maintaining competitive cost structures, topics that I have been blogging about for some time. Aberdeen full report and findings on this topic will be available next week and I will be going in to more detail on the data at that time.

Entry Filed under: Analysts/Research, General, Supply Management Best Practices, Technology