PurchTips - Edition # 79


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Strategic Sourcing & Stakeholder Resistance

By Charles Dominick, SPSM, SPSM2, SPSM3

Will Stakeholders Undermine Your Sourcing Work?

"You can sign a contract with whomever you want. But our division won't use your supplier!"

Have you ever heard this type of statement? Many strategic sourcing leaders have. Their work is a struggle.

As a reaction to resistance, many strategic sourcing leaders seek ways to force business units to support their supplier selections. But the best practice for reducing maverick spending is proactively preventing resistance.

How do you prevent resistance to strategic sourcing initiatives? You have to involve your stakeholders. And their involvement can't be superficial - they must have input into key decisions throughout the sourcing process.

To implement this best practice, simply plan on having stakeholders present when each of the following questions are answered within the sourcing process.

  1. What are our specifications?
  2. What are our supplier performance requirements?
  3. What suppliers are we going to invite to bid?
  4. How are suppliers differentiated and what is the measurable value of the differences between them?
  5. What criteria are we going to use to evaluate proposals and suppliers?
  6. What are the relative weightings of those criteria?
  7. What hidden and tangential costs may we face that could distort our total cost of
    ownership calculation?
  8. What costs of poor performance might we incur?
  9. Who makes the final supplier selection decision?
  10. What is the process for dealing with poor performance from the selected supplier?

Stakeholder suggestions may not always match the final decisions. These decisions will require collaborative internal negotiation. But using this best practice will help you avoid the "We won't use that supplier!" threat.

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