1

Procurement Outsourcing

ByTrang NguyenFull-time MBA, Class of 2018

Structure

Drivers of Procurement Outsourcing Problems of Procurement Outsourcing Managing Procurement Outsourcing Factors affecting Procurement Outsourcing decision

2

3 Drivers of Procurement Outsourcing

Cost Advantages

• Economy of scale• Reduction of HR,

training, office space cost

• Better market knowledge

• Closer relationship with suppliers

Focus on Core Competencies• Efficient process• Better information

management & purchasing analysis

Increase Profit

4 Problems of Procurement Outsourcing

Reduction of control

Outsourcing Management

Integration

5 Managing Procurement Outsourcing

1. Financial and commercial management

2. Contract management and compliance

3. Governance

4. Service performance management

5. Issue and dispute management

6 Managing Procurement Outsourcing

6. Transition and transformation management

7. Change and request management

8. Multi-service provider integration

9. Supplier risk management

10. Documents management

7 Factors Affecting Procurement Outsourcing Decision

Cost/BenefitAnalysis

Economy of Scale

In-house competencies

Complexity of products

Ability to handle

dispute/legal issues

8

Thank you!

Q & A