SIG University Certified Sourcing Professional (CSP) program graduate Andy Perkins highlights the key foundation for driving excellence between supplier and client in the new market we live in.
Procurement is an integral part of the process of acquiring goods and services from external parties that help drive the goals of an organization. This essential function is a part of every business, and a company must develop sound business models that ensure the process is efficient and effective.
Assessing business models is a crucial step in determining the strengths and weaknesses of the overall Procurement strategy. Several factors determine whether a business model is efficient and effective. This essay will explore aspects such as supplier collaboration, transparency, risk, technological adoption, and sustainability.
The first step to assess the business model for Procurement is to explore the core components. Typically, this involves identifying the needs of the organization or team, selecting the suppliers, negotiating the contracts, and managing the relationships. An efficient and effective business model should address each component and provide a clear path forward.
One key factor to explore when assessing a business model for Procurement is the level of collaboration between suppliers and the organization. Collaboration is a critical aspect of supplier relations. Additionally, this can be a tremendous value-add considering that resources can be leveraged and used when identifying a proposed solution. As an organization, we see this as the most significant benefit to supplier collaboration, as this allows for a solution-agnostic approach and ensures organizational alignment throughout the process. This collaboration can be done through regular meetings or project-specific initiatives.
Andy Perkins, Senior Category Specialist, Maxar Technologies