What are you doing in order to understand your company when preparing for your projects?
Today’s post is our SafeSourcing Archives.
This week we are taking a look at how two procurement professionals approached the same containerboard project within their respective company. Ray and John took different approaches to understanding the containerboard market and the sources of supply, and are now prepared to start looking at their changing company landscapes.
Ray is part of a very small procurement team and as a result he does not have nearly enough time to touch all of the areas within the sourcing process. Ray also doesn’t have a lot of extra time in order to keep informed of the constant changes that are affecting his and other businesses all over the world. Because Ray is not well-connected with other internal teams, there are new corporate initiatives being put into place in the form of new policies and programs that he is unaware of. These programs could affect decisions he makes to source any number of products and services, especially in an area like containerboard.
Ray plans to source his containerboard from the same sources he has always used, and as an added step he will ask the vendors about any recycling programs they may have or that they are part of that his company may be able to use because his company had just had a ½ day event on how they could become better recyclers in the industry.
John’s team is not much bigger than Ray’s but he made a commitment long ago to have a monthly meeting or luncheon with the 12 department heads that he interfaces with. Four (4) of these have never run a project with John’s group before for but do have some opportunities they wish to explore.
When John last met with the HR department head he learned that the company recently received some bad press for not awarding some business to a company that was female-owned. While the award was completely legitimate and the best company was awarded the business, it did bring up his company’s track record of working with minority-owned businesses. In speaking with the HR director a new process was developed to collect information about the characteristics of the suppliers being considered in John’s projects so that the decision makers could have additional insight when making final award decisions.
When John met with the Environmental Program Director he was able to learn the breadth of his company’s new green initiatives, their new specifications on recycled product use and the programs they were trying to implement. John was able to use all of this information in order to refine his containerboard specifications as well as the Terms and Conditions for this.
John also had a regular monthly meeting with the construction department head. Three months ago he learned that his company was building two new warehouses on the east and west coast in order to handle overflow and distribution within the divisions. John was curious and asked about the already spoken for capacity of the warehouses and was pleased to find out that they had each reserved space for potential projects that involved purchasing higher volumes in order to get reduced prices on some materials and product. By becoming their own distributor, John planned to structure his project for containerboard in a way that gave him leverage to try and drive better pricing and create a flow of containerboard from the warehouses to divisions that were already getting scheduled loads. This process also meant that we would be able to better control freight costs as the number and frequency of his containerboard deliveries from the suppliers could be reduced.
John now had a good feel for the market, suppliers and what his company was doing in other areas that allowed him to begin taking the next step of designing the goals he wanted to achieve through this process.
Stay tuned the rest of the week as the story of Ray and John unfolds. You may be like Ray but desperately want to operate like John but without the staff or the time to dedicate at that level.
At SafeSourcing we understand Ray’s frustration and that is why our customer services team works with you to achieve great results while removing much of the work from your plate. For more information on how we can help you with your sourcing projects, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today
We look forward to your comments.