I was happy to see Jason at Spend Matters chime in on the “Strategic Sourcing is Dead” controversy that hit the blogosphere recently. Dalip Raheja from The Mpower Group proved he was no David Clevenger when he went on a long winded two blog rant about the effectiveness of strategic sourcing. While I can’t say I understood exactly what he was trying to say - most of the writing was filled with so many buzzwords and clichés that I lost my place - I do know that he is way off base.

As a consultant that utilizes strategic sourcing techniques for customers every day, I can say assuredly that strategic sourcing is not dead. In most companies, particularly for indirect spend categories, the concept of strategic sourcing hasn’t even been born yet! And I’m not talking about small companies either. Billion dollar plus publically traded internationals still allow administrative assistants, IT gurus, and marketing people with no formal procurement training manage spends of a million dollars or more. Some do their best, usually using a three bid process or some variation thereof. Others look to maintain the status quo (if it ain’t broke, don’t fix it), bring in friends/family, or use the supplier that they “like”. There is nothing quantifiable or objective about the supplier selection process.

That’s not to say that better ways to manage costs do not exist, but strategic sourcing is always going to be a tool in the bag. To think otherwise is plain ignorance.
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Joe Payne

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  1. Catch Dalip's response to the debate...

    - Strategic Sourcing is Dead!!! (The Debate Rages On!) - http://wp.me/pNeV9-8Z

    - The Strategic Sourcing Debate, Part VI: Yup. It's still dead! - http://blog.sourcinginnovation.com/search.aspx?q=S... Sourcing Debate&sc=t&dt=3m&al=none

    ReplyDelete
  2. Catch Dalip's response to the debate...

    - Strategic Sourcing is Dead!!! (The Debate Rages On!) - http://wp.me/pNeV9-8Z

    - The Strategic Sourcing Debate, Part VI: Yup. It's still dead! - http://blog.sourcinginnovation.com/search.aspx?q=S... Sourcing Debate&sc=t&dt=3m&al=none

    ReplyDelete