PurchTips - Edition # 192

 

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Sole Source Situations: Eradicate Them!

By Charles Dominick, SPSM, SPSM2, SPSM3

How Can You Prevent Sole Source Situations?

Negotiating with a sole source supplier is arguably the most difficult situation for a procurement professional. Therefore, it's important to know how to prevent sole source situations from happening in the first place.

Sole source situations often occur when an engineer or end user writes a new specification that calls for the use of goods or services from a specific supplier. Once the specified item is launched, the specification and suppliers can be very difficult to change.

CPO Chief Procurement Officer

So, how do you prevent sole source situations? "The first step is actually just communication: letting the Engineering community understand that the more specific they become with a specification, the harder it is for Procurement to drive value for the overall end product and the end user," according to Jim Nelles, partner with Roland Berger Strategy Consultants.

Nelles says that procurement professionals frequently concede to Engineering too easily when receiving a supplier-specific specification. But, instead of playing victim, he recommends reviewing specifications with engineers, identifying alternatives and their price differences, and stating what better profit margins mean for the company's competitive advantage and the future of the engineering team.

If such collaboration isn't welcomed in an organization with a politically strong engineering department, Nelles suggests getting the best possible quote for the product or service as specified, then running "a parallel process by which you get quotes for the exact or similar performing substitute that you then can go back and present to the group." Though this approach can help on a one-off basis, the longer-term goal of Procurement should be to secure a permanent role on the design team ensuring early involvement in future designs.

"If you can have Procurement be a part of that process, they can influence the decision up-front and have things done the best way from the beginning as opposed to going back and trying to change things," Nelles says. "It's always easier to do it at the beginning than it is to go back and try to change something once decisions have been made by people."

How can Procurement gain acceptance onto design teams? "At the end of the day, it's really about being able to demonstrate the value that Procurement has delivered," shares Nelles. "If Procurement can demonstrate that they have worked in other areas and found high-performing products that no one knew about that they were then able to spec into a bill of materials, that goes a long way with engineers."

When engineers tell success stories about Procurement, it influences their peers to be less resistant, says Nelles. "But, once you are at the table, if you don't bring the value, you're never going to be asked back again."

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Spotlight On Professional Development Opportunities

SPSM Certification

Are you tired of not getting enough opportunities, respect, and money out of your purchasing career? Well, guess what? Nothing will change unless you take action towards becoming a world-class purchasing professional.

You see, today's employers refuse to reward employees for yesterday's skills.They demand that purchasing professionals like you use the most modern skills and achieve unprecedented results. They want you to save more money, achieve better operational performance, and reduce risk.

Is lacking a purchasing certification keeping you from getting the results, opportunities, respect, and money that you want out of your career? Today's employers refuse to reward employees for yesterday's skills. They want you to save more money, achieve better operational performance, and reduce risk. They demand that purchasing professionals like you achieve unprecedented results and without the most modern skills that can be a challenging feat!

So how can you acquire the most modern skills, achieve meaningful results, and convincingly prove your capabilities to today's employers? There is an impressive purchasing certification program that will teach you what you need to accomplish all of this and more. It is the SPSM® Certification, earned by completing the Senior Professional in Supply Management® Program. And you could earn it in less than a year - maybe even much less than a year!

Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) (with the option of getting a Study Guide on an iPad) at:

Distinguishing yourself as an achiever in purchasing is key to sustaining a rewarding career, even in these difficult economic times. Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) at:

Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices  into your organization and achieve your career potential. And if you sign up for the Senior Professional in Supply Management® Program on or before May 31, 2008, SPSMSM Certification Program on or before 4/30/2007, you also get these and other bonuses valued at over $700:

  • FREE $30 gift certificate to Amazon.com!
  • FREE CD-ROM with printer-friendly versions of the class materials!
  • FREE Purchasing Performance Measurement spreadsheet template!
  • FREE audio CD about purchasing job security!

To learn how to earn your SPSM® Certification and get these valuable bonuses, visit:

Earning your Senior Professional in Supply Management® (SPSM) Certification is the action to takeif you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSMSM Certification at:

Learn how to earn your SPSM® Certification at:

www.NextLevelPurchasing.com/spsm.html

The Latest Purchasing News!

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Want to learn more about today's topic? Then check out my podcast interview with Bill Dorn! Podcasts are audio files that you can listen to on your PC, download to your iPod/MP3 player, or burn to CD. Our Purchasing & Supply Management Podcast SeriesSM is a new way for us to help you succeed!

It's absolutely FREE to download the audio. Add it to your collection of great purchasing learning material!

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Free Procurement Training & Certification Starter Kit

This Starter Kit gives procurement professionals like you a clear idea on what it will take to become certified. You'll get an excellent feel for what you will need to learn and how long it will take.

Click here to learn more

Included in your free Starter Kit:

  • Access to two lessons from courses that are part of the Senior Professional in Supply Management® Program
  • A Certification & Training Planning Template
  • Case studies
  • A free Basic Membership in the NLPA

Together, these materials will help you decide how well the SPSM® Certification can help you achieve your career goals.

So, what are you waiting for? Begin your pursuit of a more rewarding procurement career – get your Procurement Training & Certification Starter Kit now by signing up for a free NLPA Basic Membership!

If you are already a member of the NLPA, click here to login and visit the "Starter Kit" tab to access these resources.