The availability status of a contract determines the correct sourcing strategy. A product under a long-term agreement requires different sourcing strategies when compared to a commodity without (or expiring) agreement terms. For example, sourcing teams wouldn’t normally run a slow auction on the item under a 3 to 5 5-year contract.
Instead, they might extend the contract conditions to cover additional locations. Spend compliance tracking – ensure that company representatives make purchases based on negotiated conditions and conditions. User adoption campaign – communicate to company representatives how to choose the goods and services they want. This ensures high savings’ implementation rates.
Contract termination – terminate a romantic relationship with a provider who does not meet quality, term, or cost targets (thus making the contract ‘available’). If an item is contractually available, then category characteristic filters should be applied to determine the project strategy. The application of category characteristic filters may determine a different strategy for each distinct set of characteristics identified. A commodity should be evaluated predicated on all Category Characteristics, not a few just. The sourcing team should rank the commodity – high, medium, or low – for each filter. The outcome provides guidance for the best possible task strategy, with the final decision made by the Sourcing Team.
- Increase in Organizational income
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- Analyzing the Income Statement
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