After reading a publication titled Procurement Redefined presented by TWS Partners, it enforced everything we at CSI Group see happening with some of our key customers. We have some thoughts on how this process needs to be addressed by both the manufacturer and supplier to make this the most effective process possible.
What is the Concept of Procurement Redefined?
Today with a truly global economy, the concept of in-house production is decreasing. In some industries, for example, it constitutes less than 30% of output. This creates a more complex demand on the supply chain. Companies are relying more on their suppliers to provide them with value added solutions and innovations. They are requiring solutions for manufacturing, engineering, product creation, and logistics.
With procured goods and services accounting for two-thirds of a company’s cost structure, it is apparent that the role of a firm’s procurement department has changed dramatically over the past several years.
Procurement has become a strategic function as it has to insure the company remains cost competitive and still innovates. It has to focus on building strong relationships with its’ key suppliers and continue to strengthen the firm’s capabilities to remain competitive in a fast moving environment. The companies who fail to capitalize on working in conjunction with their supply base will ultimately begin to lose ground to their competitors that recognize the value of a collaborative partnership concept.
At CSI Group, we are fully aware of what it takes to build a collaborative partnership with key customers. Our model is built to supply multiple technologies and value added services that can help our customers reduce costs and react quickly to their customers’ demands.
We become involved with a customer’s needs at the beginning of the sales process. This is mandatory as the requirements for both manufacturer and supplier change. As a team, we must have a true understanding and a commitment to what is necessary to make a success of the program.
Some examples of early involvement with our strategic customers to build programs that add value to their ongoing pursuit of remaining highly competitive in their markets are; [Read more…]