Which combination is cited as drivers of strategic sourcing?

Which combination is cited as drivers of strategic sourcing?

• A. Improve financial performance, increase customer focus, reduce waste and lead time
• B. Reduce costs alone
• C. Expand supplier base without regard to quality
• D. Increase lead times to ensure quality

Answer: (A)

Strategic sourcing aims to create value by aligning procurement decisions with overall business goals—not just chasing lower price, but also enhancing performance, quality, and speed across the supply chain. The drivers cited—improving financial performance, increasing customer focus, and reducing waste and lead times—embody this broader objective. They address cost efficiency while boosting value delivered to customers and streamlining operations, leading to better profitability, service levels, and responsiveness. Reducing costs alone misses other important elements like quality, delivery, and customer satisfaction. Expanding the supplier base without regard to quality introduces risk and can undermine performance, since more suppliers isn’t inherently better if they don’t meet requirements. Increasing lead times to ensure quality runs counter to the goal of a responsive supply chain, where shorter and more predictable lead times often support better service and competitiveness. So, the combination that includes financial performance, customer focus, and lean efficiency best represents what drives strategic sourcing.

Strategic sourcing aims to create value by aligning procurement decisions with overall business goals—not just chasing lower price, but also enhancing performance, quality, and speed across the supply chain. The drivers cited—improving financial performance, increasing customer focus, and reducing waste and lead times—embody this broader objective. They address cost efficiency while boosting value delivered to customers and streamlining operations, leading to better profitability, service levels, and responsiveness.

Reducing costs alone misses other important elements like quality, delivery, and customer satisfaction. Expanding the supplier base without regard to quality introduces risk and can undermine performance, since more suppliers isn’t inherently better if they don’t meet requirements. Increasing lead times to ensure quality runs counter to the goal of a responsive supply chain, where shorter and more predictable lead times often support better service and competitiveness.

So, the combination that includes financial performance, customer focus, and lean efficiency best represents what drives strategic sourcing.