There’s an urban legend that circulates among the fans of the NFL Pittsburgh Steelers of the 1970s. The legend goes something like this. During these years the Steelers were dominant. Some people believed that the dominance was the result of the innovations to the game that were introduced by the then Steeler Coach–Chuck Noll. Supposedly on one occasion the coach of an opposing team told Coach Noll that he was going to snatch the coach’s playbook. The always serious Noll told his counterpart, “go ahead. But, understand it won’t make a difference because it’s all about execution.”
Legend or not, the message is clear: It’s all about execution. There are many companies proclaiming they do sourcing strategically. How do we know this? There’s no shortage of articles, blogs, whitepapers and reports telling us all about the brilliant accomplishments of sourcing organizations. Even sales professionals tell us that many of their customers are employing sourcing strategies. These sales professionals substantiate their position by telling us that their customers are doing research and issuing three bids before making a decision—“so they must be doing strategic sourcing.”
By definition strategic sourcing is a systematic core process within the larger function of supply chain management that encourages purchasers to plan, manage, and develop the supply base in line with a firm’s strategic objectives. This is accomplished through the application of current best practices to realize the full potential of integrating suppliers into the long-term business process. Hmmm? Is this accomplished by some research and three bids? Unlikely.
The measure of success for sourcing organizations is in the execution. It takes discipline and commitment to execute, especially in today’s world of constant distractions. The companies that execute on their sourcing strategy—from the identification of the opportunity through to its implementation and development (aka continuous improvement)—are the companies that are delivering value in the form of managing Total Cost.
The question that all sourcing groups continually need to ask themselves is “How well are we executing?” Why? Because it’s execution that makes the difference.