Optimizing Strategic Sourcing

A strategic sourcing project was done for a starch manufacturing company. The company had a very large supplier base for corn and it was largely convenience sourcing leading to suboptimal quality of corn resulting in operational issues and lesser yield. The project involved defining key performance indicators such as quality, delivery reliability, cost competitiveness, accessibility and responsiveness. A standardized scorecard template was created, and performance data was collected and evaluated. Suppliers were informed about the new evaluation process and collaborated in setting realistic performance targets. As a result, the company improved the raw material quality, supplier delivery reliability and were able to make more informed strategic sourcing decisions. The project also enhanced risk management by identifying underperforming suppliers early, better controlled process leading to a yield improvement of 6% and strengthened the company’s competitive position through a more efficient and responsive supply chain.