Strategic Sourcing Manager — The Ultimate Guide
A strategic sourcing manager is a key person in ensuring that the strategic process is effective and efficient. However, not many people know their real role in procurement.
In this article, we will discuss what a strategic sourcing manager is. We will discuss the role of strategic sourcing managers within the procurement team and their responsibilities in a company. Additionally, we will tell you the skills needed to be a strategic sourcing manager.
Once you are done reading this article, you will know the importance of having a strategic sourcing manager in a company. This will also allow you to be an effective strategic sourcing manager if you ever think of taking this career path.
Before we tackle what strategic sourcing managers are, we must first know strategic sourcing to fully grasp their role in the company.
Strategic sourcing is a part of the supply chain and puts an emphasis on customized solutions and strategic partnerships. It organizes the information gathered through the use of solutions to find the best values in the marketplace.
Thus, strategic sourcing focuses on analyzing the patterns in the process to make it efficient. Additionally, it assesses the suppliers of the company to find the best supplier in the market and collaborate effectively which will enable them to establish a long-term relationship.
Whatis a Strategic Sourcing Manager?
A strategic sourcing manager is often confused with a procurement manager. To clear the confusion, the difference between the two is dependent on the size of the organization and the maturity of the procurement operations.
A strategic sourcing manager is common in large enterprises with a huge procurement budget and works with various suppliers that are in different places.
Now that we cleared the confusion, strategic sourcing managers are evidently focused on strategic sourcing. They are involved in knowing and writing down the procurement policies and strategies of the company.
Strategic managers work with internal and external stakeholders to understand and procure the right materials that are necessary for a company to operate. Thus, they are also responsible for sourcing the right suppliers to collaborate and establish long-term relationships.
Of course, in establishing a long-term relationship, strategic sourcing managers manage the company’s relationship with its various suppliers.
All in all, strategic sourcing managers use data to make informed decisions as what they do can have a huge impact on the overall process of the company.
Responsibilitiesof Strategic Sourcing Managers
The title strategic sourcing managers are getting popular through the years due to companies employing a strategic approach in procurement. Therefore, strategic sourcing managers are essential to support the strategic approach and initiatives of the company. The following are some of the responsibilities strategic sourcing managers do in their work:
- Supervise the supply portfolio to ensure transparency of spending
- Generate and integrate efficient sourcing and category management strategies
- Assess and calculate the costs of procurement
- Create negotiation strategies and secure profitable deals
- Collaborate and cooperate with stakeholders to ensure agreement on contract terms
- Perform cost analysis
- Estimate and mitigate risks
- Source and establish a long-term relationship with trustworthy suppliers
- Determine the quantity, quality, and timing of the delivery.
SkillsNecessary to be a Strategic Sourcing Manager
1. Risk management
Strategic sourcing managers should be able to identify risks in a dynamic business environment. Also, they must create ways to mitigate the effects of the risks to the company.
Strategic sourcing managers should be flexible enough to respond to abrupt changes in the business environment. For example, when a supplier pulls out or has breached the contract, the manager should be able to respond quickly.
3. Negotiation skills
They must be able to negotiate favorable contract terms for the company without harming the relationship that they might create once they had contracted the supplier.
In complex procurement operations, a problem will always show up that needs to be solved. This includes logistics problems or unexpected costs. The strategic sourcing manager must be able to create ways that can solve the problem.
5. Detail oriented
Strategic sourcing managers should be keen on details. A minor mistake can lead to massive losses in the resources of the company. They should be uncompromising with the details and be able to analyze large volumes of data.
Strategic sourcing managers should always incorporate data to be able to create informed decisions.
6. Time management
Strategic sourcing managers have a lot to do. From sourcing strategic suppliers to optimizing the procurement process, they will need to manage their time effectively.
7. Communication skills
Strategic sourcing managers should know how to ask the right questions to get the best response. They should also know how to communicate the requirements well with their suppliers for them to make quality proposals.
Strategic sourcing managers must work with their internal stakeholders as well to know what they need. Thus, this will limit you from having duplicate purchases.
+ What are strategic sourcing managers?
They analyze indirect procurement expenditures by sourcing suppliers, creating policies, developing cost estimates, and negotiating contract terms for a company.
+ What is strategic sourcing?
It is a part of the supply chain and puts an emphasis on customized solutions and strategic partnerships.
+ What is the salary of a strategic sourcing manager?
In the United States, a strategic sourcing manager earns a total of $143,824 per year.
For Procurement Professionals
Want to close better deals? Prepare fast and achieve deal results you have been dreaming of? This course is a perfect fit for ambitious procurement & sourcing professionals. Enroll now and equip yourself with the full range of skills needed to master the art of the deal.
"Very useful course, many actionable strategies"