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In summary, this report has focused on evaluation the selection criteria and sourcing strategies for enabling appropriate selection of suppliers for goods, services and works. Through a focus on Ericsson organisation different spend categories, a set of sourcing approaches have been identified. The approaches have been evaluated through the application of different tools and techniques. This is with different available data from Ericsson spend categories being evaluated in detail. Further, for the different approaches, the risk analysis and potential challenges impacting their implementation. The findings indicate that there is no one-size-fits all approach for selection criteria and sourcing strategies. The best practice is dependent on the organisation category of spend and suppliers availability.
A set of recommendations can be provided for successful formulation of selection criteria and sourcing strategies. These include;
- In SWOT analysis, one of the identified weakness is failure to use technologies in their sourcing approach. As a best practice, Ericsson can make investments in modernised technology including AI, machine learning in improving their sourcing strategies
- Since there is no one-size-fits all approach of selection criteria and sourcing strategies, the best practice would be to harness collaborative and partnerships relations for success of their sourcing.
- Pursue a holistic L&D practices by the PS&M in order to understand the best sourcing approach which would be in a position of enhancing the overall process of sourcing
- Further, from the risk analysis, some of the risks identified are not UpToDate. Hence, it is important continuously updating supply chain networks for identifying potential risks which are internal and external.
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This report is concerned with exploring diverse sourcing approaches in procurement and supply management (PS&M) for implementation in the IT category in today’s business environment.
The basis for this analysis is the IT procurement strategy at ROSHN, one of Saudi Arabia’s key contributors to its Vision 2030. Data, which have been gathered from ROSHN’s internal documents have been used to achieve the aim of the report and some strategic frameworks were applied such Mendelow’s Matrix, STEEPLE and Kraljic Matrix.
The findings here indicate that ROSHN’s preferred approach is to multiple source the services to ensure a degree of flexibility and to balance the risks involved in what is fundamentally a competitive and fast changing market. Multiple sourcing is used to increase vendor options and pricing competitiveness, while sole or single sourcing is used in very limited case.
Further it indicates that where dual sourcing is employed, the diverse solutions or vendor capabilities will be required to meet the extensive project requirements that ROSHN has for smart community development. ROSHN’s application of supplier appraisal tools in the IT category will achieve value for money, quality, and meet its strategic goals.
Based on these findings, several gaps were identified that can be managed through the following recommendations:
- Internal and external analyses should be carried out in order to pinpoint the best or most effective sourcing strategies for IT.
- A broader sourcing appraisal strategy should be introduced within the procurement policies and practices.
- Improve in focus in managing effective sourcing strategies based on organisational objectives.
- Broader inclusion of stakeholders in the procurement process, in order to enhance sourcing strategy effectiveness.
- Capacity development initiatives should be implemented in the PS&M practices, especially within IT category.