(by Vincenzo La Notte, Professor, LUISS Business School)
September 30, 2015

30/40 years ago, the demand for goods and services was much bigger than supply and the role of Production was central; production systems were vertically integrated and the strategic role of Supply Management was marginal. The buyer took care of administrative duties and the relationships with suppliers were limited to asking for 3 bids in order to choose the most convenient.

Nowadays we are living in a total different world: the supply of goods and services is definitively higher than demand and companies need to build inside their competitive advantage to face competition, which is global, and no longer local or regional!

Customers’ expectations are related to quality, fast deliveries, reliability, customization. The large part of companies have outsourced many processes in order to focus on their core competencies. Then suppliers are a strategic part to meet customers’ expectations.

Thus, the choice of supplier is important, because it does not mean simply to choose a supplier, but a partner who has to support the business. The modern buyers have a strategic role and their competencies should be firstly strategic with regard to the supplier positioning in the matrix of Kraljic in order to build the competitive advantage and synergies with customers-suppliers.

Secondly, the modern buyer is a business facilitator who understands the financial strength of the supplier through the analysis and the correct interpretation of the ratios. In addition, he has technical skills and technologies knowledge in order to check if the supplier is properly equipped for the business needs. He holds logistics expertise and legal expertise, in order to roll out agreements with the supplier. The mentioned skills must be matched with negotiation and relationship management skills to get the best results with all the counterparts.

All the above mentioned aspects are deepen in the course ACQUISTI & SUPPLY MANAGEMENT (Educational programme allows participants to obtain the CPSM® ISM* certification – designed for professionals, experts and managers in Purchasing and Procurement). Material and exams are in English.

*Institute for Supply Management™ (ISM) is the first supply management institute in the world. Founded in 1915, ISM is a highly influential and respected association in the global marketplace with a membership base of 50,000 professionals in 75 countries around the world of the most important organizations worldwide.