Purchasing prepares University for strategic sourcing change

August 31, 2010

Purchasing Services is preparing to move its Strategic Sourcing Initiative forward during September when the first of the University's showcase suppliers are introduced and the BOILERMART is made available to Purdue staff for purchasing goods and services.

What is strategic sourcing?

The objective of strategic sourcing is to reduce the total delivered cost of purchased goods and services while maintaining or improving quality and service.

Strategic sourcing is a multifaceted, continually evolving procurement process that includes supply chain management, pricing, product assessment, and best practices directed to reducing the total cost of procurement, said Larry Pherson, director of Purchasing Services, when he spoke to a group of requisitioners Monday at the first BOILERMART training session in Freehafer Hall.

Carol Conner, business process manager for Purchasing, agrees and offers additional definition.

"It's also a cross-enterprise activity that involves collaboration among many different areas of the University," she said. "It's not only about price. It's also about quality, service and delivery, all of which make up the total cost."

They emphasize their vision that strategic sourcing will change the University's perception of purchasing from a single act to a total process.

"We want requisitioners to consider the entire purchasing process," Pherson said, "price, ease of placing orders and delivery time."

For the past several months, Purchasing and the Strategic Sourcing Task Force have evaluated the University's purchasing history and processes, seeking out opportunities for cutting costs and increasing savings. The outcome has produced new strategies for developing mutually beneficial relationships with IT distributors and suppliers of office products, copiers, computers and custodial commodities. When put into practice, those strategies will help the University determine which of its vendors to designate as "showcase suppliers."

"Showcase suppliers," Pherson said, "is our term for suppliers that agree to assist us by offering the best-priced products, just-in-time delivery, online ordering and electronic invoicing, all contributing to lowering the cost."

BOILERMART is the new University portal for accessing showcase suppliers and the catalogs of other University suppliers. BOILERMART will facilitate finding the product to meet a need at the lowest total cost.

The rollout of the overall Strategic Sourcing Initiative is being done systematically, Pherson said. Showcase supplier selections will be announced as selections are made. During the week of Sept. 13, Purchasing Services will demonstrate how to access and use the new BOILERMART portal.

What does strategic sourcing mean to staff?

Strategic sourcing affects the University in many ways -- the most important being savings for departmental budgets.

"In today's economy," Pherson said, "leveraging Purdue's purchasing dollar is a prudent and necessary thing to do. Because Indiana's budget concerns have trickled down to how it funds Purdue, we have no choice but to be smarter in our spending."

Economic challenges have affected nearly every arena, and Purdue is no exception. When the total cost of ownership is reduced, the savings help to narrow the budget deficit, said Denise Laussade, director of the Office of Treasury Operations and member of the Strategic Sourcing Task Force.

The first of several BOILERMART "Train the Trainer" sessions started this week and by month's end, Purchasing hopes that every Purdue employee involved in acquiring goods and services will have had an introduction to BOILERMART.

Details for registering to attend one of the training sessions will be announced in the coming days in Business @ Purdue News. Information also is available by contacting the Business Services Training and Communication Team by e-mail.