Our 2015 Papers – Complex Sourcing and the Future of Procurement

Before we get into all the exciting new briefing and research papers we will have for you in 2016, we thought we would just remind you of those we published in 2015. They are all free to download and we always aim to make them stimulating and thought-provoking but not too full of jargon, technological detail or business waffle. Look on it as our contribution towards the continuous professional development of the procurement profession.

So this week we will just have a brief reminder of those papers. And of course we welcome any comments, positive or negative, and indeed if there are areas where you would like to see us focus more attention, we’re very grateful for ideas and thoughts on that too!

Today, two papers sponsored by complex sourcing experts Trade Extensions.

What Defines Complex Sourcing – and Why Does It Matter?

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In this briefing paper, we look at complex sourcing and consider which factors contribute towards making a particular sourcing task “complex.” It is important for procurement practitioners to understand this as it defines where risk and opportunity tend to exist and also highlights where advanced sourcing technology can be best used to help deliver the benefits.

The paper proposes nine factors that drive complexity. Some are determined by internal factors, such as the breadth and diversity of internal users or budget holders who have an interest in what is being purchased. Then there are external factors, and also those driven by the commercial models chosen or prevalent in that market, such as multi-level (tiered) supply chain options for structuring the contracts.

In the final section of the paper, the use of “Market-Informed Sourcing” (advanced sourcing technology) is briefly discussed. This uses advanced mathematical techniques to solve such complex problems, and understanding what defines complexity will also help to indicate where this type of technology can potentially bring the most benefit to organisations.”

The Future of Procurement

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Procurement has blossomed as a profession and a function over the last twenty years; is the outlook set fair for the next twenty, or are the storm clouds gathering? Arguably, the factors that have driven that growth in the function were largely outside the control of procurement professionals, so the future will be quite different, and some factors will actually work against procurement. So change will be needed if procurement people and functions want to continue to have central roles within their organisations, we believe.

This paper is co-authored by Peter Smith of Spend Matters and Sigi Osagie. We think anyone interested in our profession will find this a stimulating read, and perhaps take away a few points in terms of what we all need to do, if we want that future to be bright.

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