Strategies in International Procurement
Frank Straube et al
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Authors: Straube, F., Oezgen, A., Ouyeder, O.
International Cooperation Partners: Prof. Dr. Paulo Fernando Fleury da Silva e Souza (Brazil), Prof. Dr. Jiazhen Huo and Prof. Dr. Sidong Zhang (China), Prof. Dr. Victor Sergeev (Russia), Prof. Dr. Mehmet Tanyas (Turkey), Rick D. Blasgen (MBA) and Prof. Dr. Thomas W. Speh (USA)
1. Through intensive cooperation and development with suppliers and logistics service providers as well as sustainable procurement strategies Top Performers are achieving their cost and performance objectives far better than the average in this representative sample.
2. Top Performer companies could be identified in every country, several industries and among medium sized and large enterprises; they follow all very similar strategies.
3. There is not one single country with best practice performance for emerging market sourcing. The key for successful sourcing is the pursuing of differentiated country- and industry-sector-specific objectives.
4. Since 2007 study there are no significant improvements in problems that buying companies are facing in Emerging Markets. Meanwhile Top Performers are moving far ahead from the average.
5. A successful supplier management strategy, characterized by closer cooperation and development of suppliers’ competencies, leads to cost reduction, higher product quality as well as increased service levels.
6. Establishment of a two-step supplier development approach consisting claiming and fostering supports a successful supplier management.
7. Implementation of information and communication technologies has not achieved a satisfying level in collaboration with suppliers.
8. Regarding high sophisticated services logistics service providers have high potentials to incorporate into Emerging Markets sourcing processes. Top Performers are outsourcing significantly more to LSP.
9. Sustainable Sourcing is important to the surveyed companies. It is structured in economical, social and environmental and as a holistic approach an important lever to collaboration and success.
10. The implementation of environmental methods as part of sustainable procurement is in an early stage, and this step is primarily taken by Top Performer companies. They follow up this topic and achieve by this effort better cost and performance levels.
11. Following a top-down approach in order to position sustainable procurement as a corporate strategy is important.
- The importance of International Procurement is continuously increasing. This trend is supported particularly by the economic development in Emerging Markets such as Eastern Europe, Asia and South America. Procurement values (in Euro) indicated by surveyed companies are supporting the increasing trend in markets such as China (averaged 20%) and Eastern Europe (averaged 17%).
- The 2010 study found that companies have stabilized in current Emerging Markets, and that large-scale translocation from one region to another is not one of the highest priorities.
- Study results show that companies are pursuing more than one objective in the Emerging Markets and they are taking the opportunity to benefit from local-to-local as well as local-to-global production.
- Sustainable procurement encompassing economical, environmental and social aspects is increasing in importance due to its impact on successful Emerging Markets sourcing. Purchasing and procurement managers are adopting sustainability in their procurement processes because of growing importance of climate change and limited resources. The conducted study contributes to procurement managers to learn from the best practices of the Top Performers of this study.