The headline of one of my previous articles, “The Most Unenviable Job in Purchasing,” sums up my negative view of a purchasing department’s strategic sourcing function. In my experience, the solitary focus of strategic sourcing has been piece-price. And there is always someone who will offer a lower price.

What’s wrong with this approach, of course, is that there are other desirable supplier capabilities that can positively impact OEM customer internal costs, as well as position them to increase revenues/profits through satisfying incremental demand—i.e., demand that was not forecast. And these are largely ignored in today’s source-selecting strategy and process.  

Read the full article on IndustryWeek here.