Basics of successful Strategic Sourcing Initiative Pre-Planning

When planning any form of successful Strategic Sourcing Change Initiative, the pre-planning (prepping) is as important as the actual Change Initiative planning and implementation itself.

This is obvious, even to those with minimal change initiative experience, but it is astonishing how many times these basic pre-plan components are overlooked and result in Initiative failure or only part success.

The principal Pre-Plan components consist of:

Component 1 Know what you want to achieve, potential snag points etc

Many initiative originators have a good idea regards the goal that they want to achieve through the initiative, but no real clarity on what the chronological deliverable and measurable objectives(steps) might be, necessary to successfully achieve the overall goal. Be sure that you clearly understand early on what the basics are that you want, and how you are going to get there.

Develop a clear, precise Goal and accompanying Objectives for the Strategic Sourcing Initiative at the concept stage. If the initiative is strategic enough, and budgets permit, consider outside consultancy to assist in developing or refining such goals and objectives, at your earliest convenience. 

Initiatives need to be marketed to other parties within the organisation, in order to obtain sponsorship and buy in. How are you going to sell the concept to other colleagues if you are unsure or vague?

Identify early on snag points such as loyalty and company politicking factors, colleagues who are prone to being obstructive, cost considerations, internal skills to support the initiative, and any other potential snag points. In instances of important change initiatives, it really is worth the cost to bring in a qualified, neutral unbiased outsider to effect the change initiative.

Identify at pre-plan what you require regards skills and leadership (both strategic and tactical), where to get them (if necessary, from outside the organisation).  Also know exactly what role each member of the team fits into, and equally importantly, how precisely you are going to support and empower these team members to accomplish their respective objectives.

Predict at concept level what the total tangible and intangible cost is going to be in terms of financial, workload and commitment, internal skills vs” bought in” skills, stress factors, reputations, work relationships etc.

Component 2: Executive (Board) Sponsorship

The second and most imperative step is securing executive (Board) sponsorship for any strategic sourcing initiative. Many initiatives fail for reasons traceable to the lack of executive sponsorship. Pragmatically put: “unless the lead dog in the team insists, the other sleigh dogs in the pack don’t listen too well!”. Most effective Supply Chain initiatives are cross-team in orientation, and therefore need highest level executive (Board) sponsorship to pave the way by reducing resistance and increasing acceptance and participation from all necessary operational level stakeholders and participants.

Component 3: Cross-Function Buy-in and Collaboration

Once you have obtained Executive (Board) Sponsorship, ensure you get buy in from the other initiative necessary functions within the organisation. Do this with the intent on creating a management based organisational cross-Functional strategic sourcing Team. These functional representation team members are selected from other departments from which vital input is required such as IT, Engineering, Production, Finance, HR, Sales etc.

Component Three is the vital point for cross-function management buy-in and therefore the logical departure point. Departmental manager will express concern as to the impact of the initiative on their daily activities and routine, how serving on the strategic sourcing team is going to affect them  and their staff’s regular daily jobs and therefore performance, and many other points of concern. Consequently, it is vital during this step that organisational buy-in is secured thru the successful marketing of the all benefits, of the proposed initiative to all Functional Stakeholders.

It is critical to include cross-locational team members where applicable, for a variety of strategic reasons, including ensuring that willing “buy-in” for the planned initiative is achieved from all regional parties concerned. Furthermore, since much spend areas occur at location areas, valuable insight and operational intelligence can be gained from location (or branch) managers and executives.

It must be remembered that as a fact of life, the majority can never be pleased all the time, so resistance to any proposed change initiative, will always be incurred. Therefore, obtaining substantive Board level support early on is vital to underpinning the success of the proposed initiative.

Component 4: Seconding team members and building Operational Strategic Sourcing Teams

Most change initiatives in Strategic Sourcing rely heavily on seconding team members on a part-time basis as managers have little choice. This is great for minor initiatives. However, the overriding problem with this practice is that those seconded members are not totally committed nor necessarily skilled enough within the change area. In fact, it is often this reason that the need for the initiative arose in the first place!

When pre-planning proposed strategic sourcing change initiatives, once again dependent on budget constraints and strategic or tactical importance, consider buying in specialised skills dedicated to achieving the goal of the initiative. This could most probably be achieved for less cost and effort than actually thought possible.

Pre-Planning for effective strategic sourcing initiative rollouts, need to be carefully considered before any actioning regarding expectations, buy-ins, cross -function interaction who, how and what you require to achieve success from the proposed initiative.

Hopefully these Basics 101’s provide some “food for thought” to some reader.

Should you have Strategic  Sourcing or Tactical Purchasing requirements visit www.furrutterandassociates.co.za.

Karl Furrutter is a consulting procurement specialist with over 25 years’ experience and managing associate at Furrutter & Associates.