Developing Procurement Strategic Sourcing Practices Using Centricity

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Photo Provided by Augie Malson; CC

There is an increasingly interesting topic regarding procurement strategic sourcing.

As a cutting-edge supply chain manager, you already know that strategic sourcing is a way of creating competitive advantages.

For those who haven”t heard of strategic sourcing; procurement strategic sourcing is defined as designing and managing supply networks to be aligned with operational and organizational performance objectives (Eltantawy & Giunipero, 2013).

One way of developing procurement strategic sourcing is through the implementation of strategic sourcing centricity (Eltantawy & Giunipero, 2013).

The idea of strategic sourcing centricity believes that it is important to understand the way managers make decisions. When managers make well informed decisions, strategic sourcing centricity will align a firm”s goals and needs to its procurement strategic sourcing functions (Eltantawy & Giunipero, 2013).

Strategic sourcing is defined by researchers Reham A. Eltantawy & Larry best online casino Giunipero in three ways (2013):

  1. The firm chooses to make products in-house or buy products throughout a supply chain.
  2. The firm chooses to anticipate long-term implications for current procurement strategic sourcing on buyer/supplier relationships.
  3. The firm focuses on understanding the dimensions of their strategic sourcing strategy.

All three ways of identifying procurement strategic sourcing can be useful. However an essential problem relies on the fact that these three ways are unable to complete a picture of a firms strategic sourcing practices (Eltantawy & Giunipero, 2013).

This is why strategic sourcing centricity is an important concept. The integrated centricity will create opportunities for a business to achieve superior supply chain performance.

However to adopt strategic sourcing centricity, firms must make four key changes to their supply chain management practices.

  1. Firms must create a learning-oriented environment that promotes information sharing. This is intended to improve the quality of information that employees and key-partners have (Eltantawy & Giunipero, 2013).
  2. Firms should develop agile supply chain methods that include advanced planning and market research (Eltantawy & Giunipero, 2013).
  3. Supply chain managers should concentrate on developing good relationships with key suppliers, which will then improve the free exchange of data across organizations (Eltantawy & Giunipero, 2013).
  4. Success and performance must be consistently capitalized (Eltantawy & Giunipero, 2013).

Using strategic sourcing centricity, supply chain managers will more effectively create competitive advantages within their procurement strategic sourcing activities.

Bibliography:

Eltantawy, Reham A., and Larry Giunipero. “An empirical examination of strategic sourcing dominant logic: Strategic sourcing centricity.” Journal of Purchasing and Supply Management 19.4 (2013): 215-226. Print.

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About Author

Michael Fournier

Michael Fournier is a Brand Manager at Procurify whom focuses on bringing the most relevant topics regarding supply chain management and eProcurement to light. When Michael isn't writing blog posts or working on campaigns he enjoys a nice cup of coffee. And Michael enjoys his coffee like his shirts, pressed.

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