The Decision to Outsource the Procurement Function

It is imperative that the organisation considering procurement outsourcing needs to truly understand how important, strategic and critical procurement actually is to their business success.

Information about The Decision to Outsource the Procurement Function

Procurement outsourcing consists of transferring specified key activities relating to sourcing and supplier management to a third party. There can be several drivers for this course of action, including cost reduction, which will be discussed in this paper. Also discussed in this paper are arguments for not outsourcing procurement, market tendencies, business drivers and potential benefits. We also seek to assist the P&SM Professional in identifying the procurement strategy for his business, preparing the business case, identifying risks, and evaluating and selecting a service provider. Finally, we include a section on hints and tips to aid the P&SM Professional through the research, evaluation and implementation process.

Return to Understand Need / Market and Options Assessment topic.

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