AOP PodcastSourcing & Contracting

How to Build a Simple Sourcing Governance Process to Align Procurement Impact with Business Needs

By June 22, 2020 No Comments

“Governance can be a dirty word for procurement’s stakeholders. When they think governance, they think of endless stage-gate approvals, approval boards and councils, and essentially, a slow down in the buying process. The good news is that it doesn’t have to be like that!” 

When it comes to governance during the sourcing process, your experience probably matches one of the following two scenarios:

  1. You have a strict 7 or 8 step process, and at the end of each step you have to get an approval of some sort to move to the next.  
  2. You have an approval council that wants to see proof that you checked every single box during the sourcing process.  

What do these scenarios have in common? They are burdensome, create mountains of paperwork, and really slow down the process. No wonder stakeholders want to bypass procurement altogether.

In this podcast, AOP Founder and Host Philip Ideson shares his easy 2-step governance process, one that he created when he was an Indirect Sourcing Manager earlier in his career. This process – and the templates required to carry it out – are part of one of the AOP Mastermind mini-courses that you member companies will be able to access on July 1st,.

The advantages of this two-step governance process are:

  • It walks the fine line between responsible governance and onerous burden, while also fundamentally changing how procurement aligns themselves with their stakeholders.
  • It achieves agreement (and incorporates actionable feedback) on the sourcing strategy before it is carried out.
  • It secures support for the outcome (in the form of contract structure and/or supplier selection) before the final decision has been made.

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