2010
New England Supply Chain Conference & Exhibition

Building a Winning Global Commodity Sourcing Strategy: A Proactive Framework for Linking Suppliers to Customers
Alan G. Dunn, CPIM,  President and Chairman of GDI Consulting & Training Company

A presentation that provides a framework for procurement professionals to build processes for sourcing the right quality supply, at the lowest total cost, with the least amount of risk, from anywhere in the world.

The profession of procuring materials from suppliers has changed dramatically over the last two decades.  Gone are the days when the Purchasing organization is measured primarily on its ability to drive down purchase material costs through shrewd and sometimes brutal negotiation tactics.  Equally gone are the days of reactive management--responding to supplier quality and delivery problems only when they occur.

Today's progressive purchasing organization has transformed into a global sourcing operation that seeks out the best suppliers from around the globe.  This new breed of purchasing develops partnerships with suppliers and takes a PROACTIVE role in matching supplier capabilities with factory requirements at the lowest TOTAL cost.  Driving down purchase prices is now combined with requirements to establish smooth flows of materials into the factory and a constant questioning of how a supplier relationship can be improved. These improvement concerns include:

• How to improve the supplier's quality.
• How to improve the supplier's delivery reliability.
• How to minimize supply chain risks.
• How to minimize capital tied-up in purchased component inventory.

Ultimately, satisfying these concerns leads to improvements in gross margins, cash flows and shareholder value.  This presentation provides participants with a framework for developing a successful Global Commodity Sourcing Strategy.  Critical elements of a global sourcing strategy will be addressed in this framework, including:

• Approaches for Defining Commodity Categories
• Approaches for Defining Part Requirements
• Approaches for Defining Aggregate Volumes
• Approaches for Developing Source Knowledge
• Guidelines for Understanding the Real Economics of Your Commodity
• Organizing Global Commodity Sourcing Teams, roles and responsibilities
• Ideas for Measuring Global Commodity Sourcing Performance
• Approach to Building a Commodity Strategy

Technical, organizational and behavioral impediments to successful and rapid deployment of commodity management techniques will also be addressed so that participants can return to their respective companies and begin development of these techniques immediately.