INTERNAL

PROCUREMENT
AND
GLOBAL SOURCING

COURSE CODE: SCM301m

Strategic Sourcing - Welcome & Strategic Sourcing-Part 1 - Week 1 |1 Coursera

230815V01_SCM301m - Procurement and Global Sourcing
 COURSE 3:

STRATEGIC SOURCING
Section 3-1: Course Introduction
Section 3-2: Strategic sourcing- Part 1
Source: 3.1 Welcome to Course 3 | Coursera
Source: 3-2 Strategic Sourcing-Part 1 | Coursera

Source: Coursera course, RUTGERS

230815V01_SCM301m - Procurement and Global Sourcing Source: https://www.coursera.org/learn/strategic-sourcing

230815V01_SCM301m - Procurement and Global Sourcing Strategic Sourcing | Coursera
3-1: Course Introduction

Learning Objectives
The course you will learn
1. An overview of a strategic sourcing process: Seven-step Process:
• Profile a category that you're working in
• Develop a category sourcing strategy
• Generate what kind of suppliers you're looking for
• Choose the right Suppliers, negotiate and develop Suppliers
• Select the suppliers, negotiate
• Implement what you've decided to do
• Continuous improvement/ supplier relationship management
2. Understand thru readings, videos by cases
3. A peer review of the whole Courses
230815V01_SCM301m - Procurement and Global Sourcing Welcome to Course 3 | Coursera Source: Course 3 - Video 1- Welcome to Course 3
 Core Principles & Process

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 1- Strategic Sourcing
 Definition:

Strategic sourcing (SC) is a structured and

collaborative approach to leveraging targeted
spend across the organization with select
suppliers that are best suited to create value
from the external resources of the company.
(Jean-Louis Moreau, 2019)

230815V01_SCM301m - Procurement and Global Sourcing

 COURSE 3 - 3.2

STRATEGIC SOURCING – PART 1

Source: Strategic Sourcing-Part 1 | Coursera

Source: Coursera course, RUTGERS

230815V01_SCM301m - Procurement and Global Sourcing
3.2- Strategic Sourcing- Part 1

Course Expectations
1. Understand how to create shareholder value
2. Learn the first Two among of Seven Steps of Strategic Sourcing Process:
• Profile the Category
• Develop Category Sourcing Strategy
Using models to analyze:
- Portfolio analysis
- 5-Forces Methodology to analysis
230815V01_SCM301m - Procurement and Global Sourcing
3.2- Strategic Sourcing- Part 1

Why do we want to strategically source?

How do we Implement Strategic Sourcing?

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

… To create shareholder value

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process

Profile the Category
1
Develop Category Sourcing Strategy
2
Generate Supplier Profile
3
.
Choose Competitive Selection or Supplier Development
4
Select Competitive Supplier(s) and Negotiate
5
Implement
6
Continuous Improvement
7
Prepare to Source – Stakeholder Outreach
230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1
7-Step Strategic Sourcing Process (Cont.)
1- Profile the Category
2- Develop Category Sourcing
Strategy
3- Generate Supplier Profile
4- Choose competitive Selection
or supplier Development
5- Select Competitive
Supplier(s) and Negotiate
6- Implement
7- Continuous Improvement
230815V01_SCM301m - Procurement and Global Sourcing
Major Activities:
• Use information from your
Stakeholders
• Define sourcing category
• Identify category characteristics .
• Perform market analysis and
explore category evolution
Deliverables:
• Complete category profile
Example : Colgate - printed material
Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process (Cont.)

Step 1: Profile the Category (cont.)
Example: Colgate - Will use printed materials in the marketing department.
Need to discuss all related Stakeholder and decide:

• What is “in” and “out” of the Category

• Analyze the Spend-Total Company (the spend through your systems
form)
• Access the Overall Industry Dynamics
• Who are the Suppliers – current suppliers or new ones to consider
• Any technology driven solutions to help the Category
230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1
7-Step Strategic Sourcing Process (Cont.)
1- Profile the Category
Major Activities:
2- Develop Category
Sourcing Strategy • Understand buying power and
3- Generate Supplier Profile
category criticality to position the
sourcing category .

4- Choose competitive Selection • Determine sourcing approach to

or supplier Development
maximize the savings/ value
5- Select Competitive
Supplier(s) and Negotiate opportunity

6- Implement Deliverables:
- Provide initial sourcing approach
7- Continuous Improvement
230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process (Cont.)

Step 2- Develop Category Sourcing Strategy (cont.)

•• Portfolio analysis
Portfolio analysis
•• 5-Forces Methodology
5-Forces Methodology
•• Develop initial
Develop Sourcing
initial Sourcing
Strategy
Strategy

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process (Cont.)

Step 2- Develop Category Sourcing Strategy (cont.)

• Portfolio analysis
• 5-Forces Methodology
• Develop initial Sourcing
Strategy: Competitive
Bidding, Access to web-
based design & Sourcing, etc.

Source: Michael Porter (1980)

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process (Cont.)

Step 1- Profile the Category
Step 2- Develop Category Sourcing Strategy
Reading: Group discussion
1. What Is The Kraljic Matrix?

Reading 1- What Is The Kraljic Matrix.pdf

2. The 7 Step Strategic Sourcing Process

Reading 2- The 7 Step Strategic Sourcing Process.pdf

230815V01_SCM301m - Procurement and Global Sourcing
3.2- Strategic Sourcing- Part 1

7-Step Strategic Sourcing Process (Cont.)

The First Two Steps:

1. Profile the Category

2. Develop Category Sourcing Strategy

=> Prepare to Source Stakeholder Outreach

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
3.2- Strategic Sourcing- Part 1

Course 3: Strategic Sourcing – Part

1
Key Take-away:

🞴 The Purpose of a Strategic Sourcing Strategy is to Create Value for the Firm
🞴 The important thing about the process is that you have a process and you
stick to it.
🞴 Remember, it is important not only to procurement category leaders, but
also your stakeholders.

230815V01_SCM301m - Procurement and Global Sourcing Source: Course 3 - Video 2 - Strategic Sourcing- Part 1
 NEXT TO STEPS OF COURSE 3 (CONT.)

STRATEGIC SOURCING: PART 2 & 3

230815V01_SCM301m - Procurement and Global Sourcing