The Role of Sourcing and Procurement in a changing world

Nowadays sourcing teams take care of an ever-increasing amount of tasks. What is the role of sourcing and the key to its success in a rapidly changing world?

Traditionally, the role of the sourcing and procurement team in, for example, a manufacturing company has been to purchase raw materials, packaging materials, spare parts, and products and services related to running the production as efficiently as possible. Price negotiations with the suppliers have been critical. The goal has been to meet production’s needs as well as possible and just on time. Effective and up-to-date management of purchasing has been at the heart of the process.

In recent years, the changing role of sourcing and procurement has been the subject of many studies and discussions both in Finland and on international forums. Studies have been done in many universities and the topic has been discussed in for example the Finnish Association of Purchasing and Logistics (LOGY) events. With the changing world and various market turmoils, there has been a transition towards a more value-based operating model in sourcing. Naturally, efficiency in price negotiations is still important, but the role of the sourcing team has shifted towards producing also other kind of added value for the company. Today, the sourcing team must also be aware of, for example, the suppliers’ processes, compliance and quality performance, and how well the supplier meets the sustainability requirements of the buying organization.

Closer cooperation and exchange of information between the sourcing department and the suppliers is of primary importance.

Whether it is the impact of changing market situations on suppliers, ensuring availability or compliance, or developing new and more efficient cooperation models, knowledge-based cooperation brings the best possible value to both parties. It is the key to success.

As the demands for sourcing are ever-increasing, tools for information management become vital for success.

Today, the sourcing team has a growing number of tasks to handle, not only ordering and ensuring availability, but also managing a lot of information related to the supplier relationship.

By using effective tools it is possible to ensure that all the relevant tasks are taken care of and the supplier relationship management is based on knowledge.

Whether it’s about compliance or quality topics, the latest offers, the supplier’s qualitative performance compared to other suppliers or, for example, spend information, it’s important, that the information can be found in one centralized place and the overall picture can be easily created. It is important also for the suppliers that there is one place where the requested information can be entered and from where the data about previous interactions with the sourcing team can be found.

In Noventia’s solution, all of the above is available.

The renewed supplier portal will be launched soon. We are happy to tell you more – book an appointment for a presentation!

Picture of Sanni Laine-Luoto
Sanni Laine-Luoto

CEO, Noventia Oy
+358 45 114 4883


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