Solution

2.0 Development of capabilities for achieving value for money outcomes within the supply chain

2.1 Analysis of Organisation Stakeholders

To develop capabilities on achieving value for money outcomes, understanding the best practice of analysis of organisation stakeholders is essential. According to Kitsis and Chen (2021), after identification of the spend procurement professionals, outlining the relevance of impact of organisation stakeholders should follow. The best practice is achieved through adopting the 5 Rights procurement (see figure 1). This is achieved by appreciating the fact that various customers would pull the procurement and supply management role in various directions.

Figure 1:5 Rights as Business Priorities

For instance, Ericsson is involved in sourcing for vehicles used in their different operations. To identify the importance and impact of the stakeholders in this spend category for success on supply chain management, 5 Rights is used (Bals et al., 2019). This lead to development of a capability of analysis of impact of stakeholders through;

Price- This factor assists in developing the capability of achieving reasonableness, fairness, cost competitiveness and reliability (Cao et al., 2023). For Ericsson, sourcing for vehicles calls for price analysis, suppliers cost analysis and competitive pricing and negotiations.

Quality- Ability to source goods with satisfactory quality and fitting intended purpose is attained (Ali, 2019). For instance, Ericsson sources for electric vehicles as part of facilitating achievement of Saudi Vision 2030, the organisation prioritise on Electric Vehicles (EVs). In such a case, working as a procurement professional, ability for offering an accurate specifications for requirements and quality. This is with supplier and buyer position on quality management.

Quantity- Considering this factor, PS&M profession develop their capability by identifying best practice in sourcing quantity appropriate with service levels minimised. These are costs and risks. For vehicles spend in Ericsson, this is done by demand forecast, managing inventories and stock replenishment systems (Sethi, 2020). All these areas represent best opportunity for gaining increased capability.

Time- An understanding of the relevance of securing the goods in right time for meeting demand and not incur inventory costs not required (Kakwezi & Nyeko, 2019). Hence, capabilities are achieved through demand management and supplier management. For the vehicles, the considered as leading to production bottleneck and linked costs and delay in customers delivery such as costs of managing inventories.

Place– This factor entail developing the capability of delivering the goods in their required points (Cao et al., 2023). Working as a procurement professional, the best approach is by acquiring insights in distributions planning and also transportation.

Further, to be in a position of identifying the stakeholders importance in the sourcing project, application of Mendelow Matrix (Cordell & Thompson, 2019) is evaluation (see figure 2).

Figure 2:Mendelow Stakeholder Matrix

High Power; Low Interest- This level assists in identifying the stakeholders who hold immense power on the extent of achieving value for money outcomes. For stakeholders such as management, directors offer insights learnt for understanding best practice of achieving value for money outcomes.

Low power; high influence- By focusing on this category, an identification of how stakeholders who include institutions, suppliers of vehicles and government fit in this category.  They are found eliciting a direct implication on the stakeholders relations for attaining their set goals.

High power; high influence-For the vehicles sourcing in the organisation, this could entail the suppliers teams who would evidence possessing immense power and influence towards value for money outcomes. By referencing on this tool, acquired capability is essential to harness team-based working, consultation and knowledge and information sharing.

Low power; low interest– Here, by evaluating the power held by boards of management and legal teams, it is possible to acquire insights on how to promote management roles, policies implementation and to align the entire operations.

2.2 Capability for Creating Value for Money

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