Strategic Sourcing Flashcards
Learn Strategic sourcing
1.1.1 What’s is the definition of strategic sourcing?
An organizational procurment and supply management process used to locate, develop, qualify, and employ suppliers that add max value to the buyer’s products or services
1.1.2 What is the objective of strategic sourcing?
The main objective of strategic sourcing is to locate and form relationships with those suppliers that best promote the strategic and operational
goals of your organization
1.1.3 How can strategic sourcing be used as an approach to supply chain management?
*Evaluating suppliers to select ones that are compatible
*Building relationships, not just contractual obligations
*Nurturing relationships that will be mutually beneficial
1.1.4 Why might you want to limit the amount of suppliers to your fleet?
Limited vehicle providers may yield a number of benefits
including lower prices for paying in bulk
1.1.5 Describe the differences between traditional sourcing and strategic sourcing
Table 1, traditional sourcing focus is cost, Strategic is competence
1.2.1 What are the benefits of strategic sourcing?
Limited number of suppliers
Reverse logistics
*Table 1
1.2.2 How can strategic sourcing generate benefits to the fleet department?
Terms such as delivery, warranty, and service can be points of negotiation in a strategic partnership. *Table 2
1.2.3 Why is it important to measure supplier performance?
This can lead to better decisions when it comes time to decide between acquiring a new supplier or staying with a current one
1.2.4 How does strategic sourcing benefit suppliers?
Not only are
they getting larger purchases and more orders from you, they also benefit
from improved communication and not having to juggle multiple small
contracts with a vast array of customers.
1.3.1 What risks are involved with strategic sourcing?
*Overpaying initial cost
*Takes much more time to execute
*When supplier requirements are too strict or narrow
*Change in suppliers(current or past suppliers may no longer be relevant)
*Organization’s sourcing and purchasing work flow may need to be restructured
1.3.2 Describe some of the cost involved with strategic sourcing
*Total cost of ownership(Lifecycle cost)
*
1.3.3 Why is strategic sourcing time consuming?
it is more complicated, and requires more
knowledgeable and skilled personnel. Also, your organization’s sourcing
and purchasing work flows may need to be restructured.
1.4.1 What are the four steps in the strategic sourcing process?
1.Understand the spend category
2. Asses potential suppliers
3. Create a strategy
4. Select a winner
5. Cultivate relationships
1.4.2 What should your purchasing team do during the first phase of the strategic sourcing process?
the purchasing or sourcing team will identify their purchasing and price constraints, the time and money it takes for the supplier to
acquire the assets, as well as the historic purchases in asset categories.
1.4.3 What do you want in a strategic sourcing partner?
Competence, trustworthiness, communication, deals that are valuable and fairly priced
1.4.4 How can you create a strategy for strategic sourcing?
*Identify how competitive the supplier marketplace is
*Ensure that other departments are on board with your supplier choices
1.4.5 What tool is discussed in order to help select suppliers?
A balanced scorecard
1.5.1 What are performance improvement requirements and how are they used?
Necessary components to strategic sourcing. They are used to improve the cycle time, cost, quality, and delivery performance.
1.5.2 What type of teams should be created in order to help select suppliers?
Creating cross-functional sourcing teams to complete different supply chain management
tasks will ensure positive collaboration as well as the ability to select
suppliers most suitable for the organization’s needs.
1.5.3 What systems should be developed and how can they help the organization?
*purchasing systems to increase the emphasis the links between external systems along with networking between purchasing sites with suppliers.
*Electronic data interchange systems allow companies to communicate in real time with suppliers as well as manage a centralized location for data to be accessed
1.5.4 What are team member purchasing responsibilities?
Defined responsibilities assigned to each member of the purchasing team such as being the point of contact for a specific supplier or research new potential suppliers
1.6.1 What is cross functional sourcing team?
a group of individuals who are maintaining relationships with the fleet
suppliers and identifying the sourcing needs of the fleet
1.6.2 What is the fleet manager’s role in the cross functional sourcing team?
to oversee the cross functional team in thoroughly examining fleet purchasing activities and supplier selection as well as responsible for making the final say in finding new sources and developing those lasting relationships between vehicle supplier and buyer
1.6.3 What is the focus of many purchasing groups and what are the fleet managers’ responsibilities?
Finding the lowest cost. Voicing concerns when non-fleet members of the sourcing team focus only on low cost suppliers without taking other fleet-related concerns into account
1.6.4 What is rightsizing the fleet?
This can be determining the correct customer service level for internal service and rental fleets as well as understanding the vehicle-task suitability(sourcing vehicle that are appropriate for the specific tasks)
