Introducing … Buying as a Service
One company can’t do it all. That’s why they often seek external support for areas outside of their core competency. Hence, they work with outside legal counsel, employ advertising agencies, rely on public relations firms and outsource payroll. Allow me to introduce you to the latest business process outsourcing (BPO) category – Buying as a Service.
Through a unique combination of assessment, analysis and execution services, sourcing and procurement service organizations offer the framework, people, technology, skills and processes needed for organizations to buy better to enhance profitability.
I want that!
Recently we had the opportunity to speak to a CEO at a mid-size fitness company. His organization struggled with how to improve margins by sourcing and buying the goods and services needed to enable them to sell their products more effectively.
He was frustrated.
We began to describe my company LogicSource and the emergence of Buying as a Service. He stopped us five minutes into the conversation and said, “I want that!”
This CEO was tired of the “we can do it house” debate, realizing it would take 9-12 months– in their case–just to get an internal sourcing and procurement business function up and running and potentially even longer to select, license and implement a technology to support the program.
In addition, he and the board were transforming nearly every area of the business. There was neither time nor money to hire expensive consultants to conduct an extensive study of their sourcing and procurement challenges and provide advice. He was looking for a partner who could:
1) Study their sourcing and procurement problem
2) Quickly provide advice
3) Implement a solution with speed-to business impact
In other words, he was looking for a sourcing and procurement service provider that executes to stand up a solution quickly and drive the realization of value within months.
Bring on the experts
Let’s face it. Strategic sourcing and procurement can be a challenging, tedious business. Sourcing and procurement managers must be highly proficient in every part of the business, as well as deal with the ever-changing procurement landscape, shifting operations, commodities pricing, changing values, supplier risk, compliance, etc.
After decades working with numerous companies helping them to optimize their sourcing and procurement practices, I’m often asked “What does it take to do this right?” It comes down to this. To buy better, companies need category subject matter expertise, process improvement, purpose built technology, spend leverage to wield a bigger hammer and a well vetted supplier ecosystem to mitigate risk.
These assets are very difficult–if not impossible–for a business to build on its own. It is typically not a core competency, has limited to no funding and takes a long time to to create a return on the internal budget expense. Executives who must create transformational change quickly, need to partner with experts whose sole focus is the art and science of how to buy better. Think about it, by partnering with an external sourcing and procurement service provider you are freeing up your people to focus on their core competencies to align with your companies business objectives. Take the time to evaluate and understand how to drive measurable and sustainable profit improvement for your business through better buying. If you want it…you can have it.Tags: Execution, Strategic Sourcing, Sourcing Innovation, Sourcing and Procurement, Buying as a Service