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“Showing Value (Part V)”

By Robert A. Rudzki, SCMR Contributing Blogger
January 30, 2012 - SCMR Editorial

A simple and powerful best practice is to obtain stakeholder signoff regarding the sourcing strategy as well as the methodology for calculating results. If you’ve kept your stakeholders informed and involved throughout your sourcing process, this should be a relatively simple task.

The specific practice that we share with clients involves summarizing all key information on one page. As a result, your internal clients / stakeholders can quickly see and understand such things as:

• Sourcing category
• Baseline annual spend
• Team leader
• Team members
• Sourcing strategy
• Selected supplier(s)
• Inception date and term of new contract
• Key provisions
• Estimated cost reduction by business division
• Other quantifiable and non-quantifiable benefits
• Method of calculating benefits, with an example
• Investments needed (if any)
• Team leader signature, and sign-off block for the stakeholders

These elements can be built into a one-page format that serves as a template for all of your sourcing teams.

Very importantly, once you have the signoff in hand, it can serve as a reminder to make budget adjustments to preserve the negotiated results – and ensure that they make it “straight to the bottom line®.”

More in my next posting.

(Note: portions of this blog series are based on the author’s new book “Next Level Supply Management Excellence” – a sequel to the bestselling book “Straight to the Bottom Line®)



About the Author

image
Robert A. Rudzki
SCMR Contributing Blogger
Robert A. Rudzki is a former Fortune 500 Senior Vice President & Chief Procurement Officer, who is now President of Greybeard Advisors LLC, a leading provider of advisory services for procurement transformation, strategic sourcing, and supply chain management. Bob is also the author of several leading business books including the supply management best-seller "Straight to the Bottom Line®", its just-released sequel "Next Level Supply Management Excellence," and the leadership book "Beat the Odds: Avoid Corporate Death & Build a Resilient Enterprise." You can reach him directly at: .(JavaScript must be enabled to view this email address).

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