Enhance your business model through supplier partnerships
Strategic Sourcing resources are regularly challenged to squeeze pennies out of external spend. Traditional vendor management would suggest that the most effective way to achieve real savings is to drive reductions in purchase prices for everything from strategy consulting to pencils and paper. This often takes the form of broadly issued RFPs, over-subscribed reverse auctions, or letters threatening loss of business if the vendors don’t immediately reduce prices by 10 percent, 15 percent, or more. These strategies can lead to strained relationships between sourcing managers and their business counterparts when key suppliers no longer engage in the value-creation layer of the business model.