SUPPLIER DIVERSITY
tify a new supplier, they canvassed the corporation. They identified each de- partment that used the process, even those that only sent materials to deal- ers occasionally. This group of stake- holders was involved up front, and the team was able to avoid issues later in the procurement activity.
Planning -
A Phase That Must NOT Be Shortchanged Just So You Can Find a Supplier Quickly
The team uses the Planning phase to
flesh out business and performance re- quirements in detail. Each stakeholder group feeds its unique set of expecta- tions to the team, who then incorpo- rates them into the requirements. The team identifies the risks, scope, cost targets, and timing of the procurement effort. This phase has some unique as-
pects for a procurement project, the most important of which is identifying qualified potential suppliers. The team should think creatively about how the new supplier must create value and provide benefits that were missing in the past. With proper planning, an or- ganization can move from having sup- pliers who just sit on the sidelines to having real value partners who sup- port the strategic vision. For instance, suppose a sales organization wishes to upgrade its online store and improve order-processing time. They must identify a fulfillment supplier with strong IT capabilities and state-of-the- art warehousing. A note of caution on the Planning
phase is in order. Procurement teams must resist the temptation to short- change this step in the name of finding a supplier quickly. The task of identify- ing requirements can take months, as was the case with GM’s dealer commu- nications process. Identifying require- ments up front will uncover possible conflicts and inadequacies. For exam-
26 HISPANIC NETWORK MAGAZINE
ple, if a benefits solutions group wants to implement a web-based application process, they need to know whether their existing technology infrastruc- ture will accommodate such a change. Knowing these things will help the team come up with a realistic task list and timeline for implementation.
Executing -
The Third Critical Step in Selecting an Innovative Supplier Partner
In the Executing phase, the team
brings to bear the fruit of the Plan- ning phase by creating and distribut- ing a Request for Proposal (RFP) that reflects the business requirements. The team uses the requirements to develop evaluation and ranking tools, and then uses these tools to assess each response to the RFP. The team identifies a subset of sup-
pliers as candidates for negotiations, and conducts a series of detailed dis- cussions that include clarification of the RFP response, scope issues, schedule, and other areas of concern. This step includes multiple rounds of pricing discussions that will lay the ground- work for a final selection.
Monitoring and
Controlling -
The Fourth Critical Step in Selecting an Innovative Supplier Partner
In the procurement context, Moni-
toring and Controlling involves a review of the scope, requirements, schedule, and other metrics involved in the evaluation. This review creates an opportunity to refine assumptions and get feedback from the respondents on their ability to meet or exceed the stated performance goals. Teams can use the feedback to calibrate the per- formance goals and to make tradeoffs of scope versus schedule, for example. Then they can create a more realistic
Celebrating 18 Years of Diversity
set of performance goals, if appropri- ate. The team documents changes to performance metrics, scope, and sched- ule, and presents these for approval as well.
Closing -
The Last Critical Step in Selecting an Innovative Supplier Partner
Closing is the last phase of the proj-
ect. Here the team recommends a sup- plier to the appropriate groups, and the purchasing managers develop the contract documents. The procurement team develops guidelines on details to watch for while managing the new con- tract. For example, if the team awards a contract to a web developer on the con- dition that the developer commits ad- ditional resources for implementation, the commitment needs to be captured in the guidelines to ensure it is not overlooked. This document also serves as a reference for future procurement activities, including any follow up work with the selected supplier. This five-step method is an indis-
pensable tool for addressing current and future requirements, particularly for multifaceted contracts involving diverse stakeholder groups within your organization. Using it will ensure your ability to select a partner with the vision and capabilities needed to cre- ate a sustainable, scalable solution that advances your strategic goals.
Source:
articlesbase.com
About the Author: With more than 25 years experience in manufacturing, product line management, program management, and outsourcing ini- tiatives, Monica Johns (President and CEO of Clarity Management Consulting) can help you select an innovative supplier part- ner. To learn how she can help you reduce operating costs and revolutionize the way you do business, visit
www.claritymanage-
mentconsulting.com.
www.hnmagazine.com
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