Strategic Sourcing Agreement

Strategic procurement is an institutional purchasing process that has continually improved and re-evaluated a company`s purchasing activities. In the service sector, strategic sourcing refers to a service solution, sometimes called a strategic partnership and specifically tailored to the individual needs of the customer. In a production environment, it is often seen as part of supply chain management. Modern supply chain management experts have focused on defining marked differences between strategic and public procurement markets. Procurement operations support day-to-day tactical transactions such as ordering to suppliers, while strategic sourcing is synonymous with strategic planning, supplier development, contract negotiations, supply chain infrastructure and outsourcing models. Strategic best purchasing practices include digitizing documents, participating in a digital business network, and automating workflows. The process can be divided into four stages: eSourcing platforms generate useful data on an organization`s thinking activities, vendor performance and supply chain evaluation. The data will improve visibility and also provide comprehensive assessments of the various purchasing activities underway, allowing the Organization to make more informed purchasing decisions. Organize all spending data from different systems and identify and prioritize purchasing opportunities more easily. The university`s strategic procurement strategy involves building relationships with suppliers that offer deep discounts on products and services.

The university`s leverage increases with increased spending on strategic contracts, which increases and expands discounts, improves service and demonstrates to competitors the value of contracts for the next strategic procurement cycle. Benefits of strategic procurement include improving the university`s bargaining power to reduce costs, improving contract and supplier management, and reducing total costs for procurement processes by reducing the number of transactions requiring competition. Understanding the benefits of strategic procurement leads us to design a process for implementing strategic sourcing within an organization. While an isolated process may not meet the specifications and requirements of each organization, we can draw up a basic structure that can guide the strategic procurement process: tactical sourcing, on the other hand, involves a short-term and traditionally reactive approach to managing an organization`s purchasing activities.

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