As international demand grows for more and better products and services, competition becomes more intense. Businesses must keep up with rapidly changing technology while also lowering their costs, increasing quality, and improving customer service at all stages of the value chain. This is the reality of international trade.
Businesses that have implemented global sourcing have leapt ahead of the pack reducing the cost of goods, accelerating the speed to market and improving the quality on a consistent basis. Having a strong network of international suppliers is key to success in international sourcing strategy.
Contract Lifecycle Management
Contract management is the process that enables the business and supplier to meet their obligations to deliver the objectives required from the contract, on time, to quality and specification and within budget. This means actively tracking and monitoring delivery and costs, managing risks, and actively managing the relationships between the business, the supplier and key stakeholders.
This process continues throughout the life of a contract and involves managing proactively to anticipate future needs as well as reacting to situations that arise.
Managing contracts is a complicating process involving terms and conditions to be agreed between both parties. A poorly written contract can lead to disputes in the event of non-performance, leading to legal procedure.
Supplier Selection, Audit and Qualification
It is absolutely important to select and qualify the right suppliers using the right analytical tools and methods. Audits need to be detailed, accurate, consistent, fair and transparent.
Suppliers must be treated fairly, impartially and equitably at all stages in the procurement process. This means that ethical standards of behaviour must be demonstrated by all people involved in the procurement at all stages in the procurement.
Supplier Relationship Management
It is an asset to any business if they have a strong core of supporting suppliers and it is important to manage the suppliers professionally and develop these suppliers into partners.
Ultimately the success of the commercial relationship often comes down to the relationship between the business and supplier – get it right and the benefits will flow. The benefits of developing and maintaining a good supplier relationship fall on both parties. The three key factors for successful supplier relationships are:
- openness and excellent communications
- developing mutual trust and understanding
- a joint approach to managing delivery and any related problems.
Managing commodities by category is what most businesses do nowadays. IPS Connect specialises in the management of commodities by category. We focus on working with your business’s key areas of spend to secure added value. This powerful approach can build significant competitive advantage, deliver dramatic cost reduction and the value and innovation required for business success.
Supply Market Intelligence
Supply market intelligence (SMI) is one of the most critical inputs for the sourcing process. Best in class businesses have embedded supply market intelligence as an integral part of their sourcing process to reduce risk and enhance savings. With market activities constantly changing, IPS Connect is always on the lookout for the latest trends, market shifts, supply/demand movement and new product launches.
Spend analysis proactively identify savings opportunities, manage risks and optimize business’s buying power and to engineer superior performance. Data from spend analysis can improve visibility into corporate spend, as well as drive performance improvement, contract compliance, and most importantly, cost savings.
Analysing procurement spend provides data that can be used as a baseline to measure improvements, and to also provide reliable data for deciding strategies to realize short and long-term savings. As procurement moves to a more strategic function in the business, spend analysis is its fundamental strategic technique which establishes a parallel process that guides senior leaders and budget holders in maximizing value for the business’s dollar.
IPS Connect can provide a comprehensive spend analysis of any business to explore opportunities for vendor rationalisation, goods consolidation, blanket orders and frame agreements.
Whole Life Asset Management
There are many considerations when procuring assets for businesses. Besides P2P costs, there are also operating, maintenance, tools, utilities, consumables, training, storage and other financial costs to consider. End of life asset disposal needs to be taken into consideration too.
With the deployment of a successful asset life cycle management, strategy businesses can gauge when an asset will reach its optimal peak performance and analyse how long of a useful life it has left. Before eventually planning for maintenance work or its replacement.