I hope that you have enjoyed the article “Supplier Contracts: To End Or Extend?

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Too often, strategic sourcing is thought of as something that is only done after a category of goods or services has been bought in an unstructured way since an organization’s inception.  Then, after strategic sourcing is done, supplier relationship management takes over and everyone lives happily ever after.

In the real world, however, strategic sourcing can follow, as well as precede, the supplier relationship management process.  As the article points out, just because a supplier relationship is perfect after strategic sourcing has concluded doesn’t mean it will be perfect forever.

Instead, strategic sourcing and supplier relationship management should be thought of as a cycle – what we call the “Continuous Strategic Supplier Evaluation Cycle,” illustrated in this post.  The cycle begins by moving from Unstructured Buying to Strategic Sourcing to Supplier Relationship Management.  But it should continue with a point of Supplier Re-evaluation.

At this point, you’ll need to determine if a strategic supplier’s goods or services are even needed at all anymore (if not, proceed to Supplier Disengagement).  If the goods and services are needed, then you can use the questions in the article to determine if the supplier is definitely worth keeping (returning you to the Supplier Relationship Management phase) or potentially not worth keeping (leading you back to Strategic Sourcing).

Image that illustrates the continuous strategic supplier evaluation cycle

The goal is to always know that you have the optimal supplier for your current and future circumstances.

Charles Dominick, SPSM, SPSM2, SPSM3

Charles Dominick, SPSM, SPSM2, SPSM3 is an internationally-recognized business expert, legendary procurement thought leader, award-winning entrepreneur, and provocative blogger. Charles founded the Next Level Purchasing Association in 2000, oversaw its incredible growth, and successfully led the organization to its acquisition by the Certitrek Group in 2016. He continues to blog and provide advisory services for the NLPA on a part-time basis as he incubates his upcoming business innovations. Charles is also the co-author of the wildly popular, groundbreaking book, "The Procurement Game Plan: Winning Strategies & Techniques For Supply Management Professionals."

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