Supply chain management is the big picture, of which procurement is merely a piece. It refers to the beginning and end of a consumer needing a good or service and every step needed and undertaken to get that good to the consumer. This includes product development, sourcing, production, and logistics, and how the use of information technology in supply chain management is used in each step. It’s important because it provides a need to the end-user.
If you’re wondering, “Is sourcing part of the supply chain?” it most certainly is. Where you get goods from is an extremely important part, and how sourcing and supply chain management fit together is imperative.
The strategic supply management definition refers to all levels of the chain:
When you drill down deeper, they all cover:
When companies use global sourcing in supply chain management, they often worry about reducing quality, but quite often, this is the opposite case. Just as with any other changes you make, if you begin to use global sourcing, you must always run analysis reports and look at your procurement indicators and KPIs.
If you realize that there has been a problem and global sourcing may be a root cause, it’s time to take a second look. However, you’ll likely find that you are reaping the benefits of global sourcing and supply chain management. Benefits include:
When you use global sourcing in supply chain management, you will interact with global suppliers just as you would domestic ones when it comes to your sourcing steps. If you’re using an eTendering system, you would log in, post a need, be connected to suppliers based on your need, and vet one until you find the right one. The one thing to keep in mind is that global suppliers may require a longer lead time for certain products, so you have to start your sourcing process earlier than in the past to ensure that the goods reach the consumer on time.
To learn more about global sourcing and supply chain management or to hear about the many services we provide, contact EC Sourcing Group to schedule a demo today by calling 973-936-9672. We want to help you re-imagine procurement.