Strategic Sourcing
Siddhartha Chitla
STRATEGIC SOURCING
OPERATIONAL MANAGEMANT
CONTENTS ABSTRACT 3 Introduction 3 OBJECTIVES 4 METHODOLOGY OF STUDY 5 ISSUE AND DISCUSSION 5 CONCLUSION 9 LIMITATION 10 1. Loss Of Managerial Control 10 2. Hidden Costs 10 3. Threat to Security and Confidentiality 10 4. Quality Problems 10 5. Tied to the Financial Well-Being of Another Company 11 REFERENCE 11
ABSTRACT
Strategic sourcing is critical for firms practicing the principles of supply chain management. It specifically deals with managing the supply base in an effective manner by identifying and selecting suppliers for strategic long-term partnerships, involving in supplier development initiatives by effectively allocating resources to enhance supplier performance, providing benchmarks and continuous feedback to suppliers, and in some cases involving in supplier pruning activities. Currently, the methodologies in practice for strategic sourcing have mostly been subjective in nature with few objective decision models focused at supplier evaluation, which are also not devoid of limitations. This paper proposes an objective framework for effective supplier sourcing, which considers multiple strategic and operational factors in the evaluation process. Suppliers are categorized into groups based on performance, which assists managers in identifying candidates for strategic long-term partnerships, supplier development programs, and pruning. In addition, this research investigates the differences among supplier groups in proposing possible improvement strategies for ineffectively performing suppliers. Also, we demonstrate the methodological richness of our framework when compared to some of the traditional methods proposed and utilized for supplier evaluation purposes. The supplier data utilized in the study is obtained from a large multinational corporation in the telecommunications industry.
Introduction
Strategic sourcing is an institutional
STRATEGIC SOURCING
OPERATIONAL MANAGEMANT
CONTENTS ABSTRACT 3 Introduction 3 OBJECTIVES 4 METHODOLOGY OF STUDY 5 ISSUE AND DISCUSSION 5 CONCLUSION 9 LIMITATION 10 1. Loss Of Managerial Control 10 2. Hidden Costs 10 3. Threat to Security and Confidentiality 10 4. Quality Problems 10 5. Tied to the Financial Well-Being of Another Company 11 REFERENCE 11
ABSTRACT
Strategic sourcing is critical for firms practicing the principles of supply chain management. It specifically deals with managing the supply base in an effective manner by identifying and selecting suppliers for strategic long-term partnerships, involving in supplier development initiatives by effectively allocating resources to enhance supplier performance, providing benchmarks and continuous feedback to suppliers, and in some cases involving in supplier pruning activities. Currently, the methodologies in practice for strategic sourcing have mostly been subjective in nature with few objective decision models focused at supplier evaluation, which are also not devoid of limitations. This paper proposes an objective framework for effective supplier sourcing, which considers multiple strategic and operational factors in the evaluation process. Suppliers are categorized into groups based on performance, which assists managers in identifying candidates for strategic long-term partnerships, supplier development programs, and pruning. In addition, this research investigates the differences among supplier groups in proposing possible improvement strategies for ineffectively performing suppliers. Also, we demonstrate the methodological richness of our framework when compared to some of the traditional methods proposed and utilized for supplier evaluation purposes. The supplier data utilized in the study is obtained from a large multinational corporation in the telecommunications industry.
Introduction
Strategic sourcing is an institutional