Current Sourcing – The Ultimate Guide for 2023

For the professional procurement manager, current sourcing may sound like a complete mystery. The truth is that it’s not as complicated as it seems. All it takes is just an understanding of how sourcing actually works.

For this article, we are going to talk more about current sourcing. We’ll check out its definition and learn more about how we can apply this type of sourcing to our procurement process.

Once you’re done reading this article, you should have an idea of how current sourcing works.

Current Sourcing– What is It?

To be precise, current sourcing is basically strategic sourcing at its core. And because it’s also the same with strategic sourcing, its functions are basically one and the same too.

One of the best things that strategic sourcing always offers to procurement teams all over the globe is that the process never really stops. Strategic sourcing should be the continued process of sourcing (or searching) the best suppliers for your procurement projects. Even if you already have a steady supplier for your current needs, you will never know when your current supplier may suddenly start having issues.

For that reason alone, the future of procurement may also hang in the balance when it comes to strategic sourcing. With today’s economic crunch, it’s still surprising how the procurement industry is able to hold on, despite the challenges. With strategic sourcing and the help of procurement programs that augment procurement processes for different companies, it is now easy to maintain strategic sourcing for your company.

The 8 Stepsof Current Sourcing

Each step will help the sourcing manager in making sure that the strategic sourcing process is done efficiently. These steps are divided into the following:

1. 1. Analyzing product categories that are used by the business. Spending patterns, processes, and the departments involved are checked thoroughly.
   2. Developing a sourcing strategy that is based on the business goals of the company.
   3. Checking the request for template and criteria proposals.
   4. Selecting suppliers and negotiating with the said suppliers.
   5. Integrating suppliers into existing processes.
   6. Onboarding new vendors that were selected.
   7. Outsourcing providers if needed.
   8. Performance metrics tracking and optimizing the sourcing strategy if needed.

The sourcing strategy manager must make sure that the steps involved are followed, analyzed, and tracked. This will help the company make adjustments the next time a different strategic sourcing process is needed for a different procurement process.

Sourcing involves much more than just simply picking a supplier or a contractor for each requirement in isolation. It also involves continuing relationships, both with preferred sources that are giving the company the necessary goods and services, and with potential sources that may have been passed over for the present, but these are still in the running.

For its proper performance, sourcing requires actual supply market research. Supply market research identifies the set of actual and potential sources that constitute the supply side of a market while investigating their capabilities and examining market trends and long-term supply prospects. 

The following are critical success factors in strategic sourcing. These factors are based on three key areas; people, processes, and technology:

• • Know the suppliers and the market.
  • Use technology to support the execution of strategies, such as digitalization and advanced analytics.
  • Obtain senior-level support
  • Establish a cross-functional team (CFT)
  • Enforce compliance
  • Engage stakeholders
  • Adopt a company-wide supply chain focus
  • Encourage supplier innovation
  • Carry out continuous improvement
  • Set up adequate reporting metrics to show success.