Strategic Sourcing for Value

There are many types of strategic sourcing decisions, including make vs. buy, offshore vs. onshore, and selecting
between suppliers or vendors in various locations. In most of these cases, the decisions involve multiple relevant
dimensions and are made under both uncertainty and risk.

Some performance dimensions, like per-unit cost and shipping, are relatively easy to measure. Other performance dimensions, such as future innovation capability and responsiveness, are often more important than cost. But, these are much harder to assess in a sourcing decision. In this one-day session, Professor Gray takes participants
through the following topics:

  • Introduction to theories of make vs. buy, noting how these provide useful insights into how to approach the sourcing decision if “buy” is chosen
  • Evolution of the sophistication of decision making in procurement, from per-unit price, to total landed cost, to total cost of ownership (TCO)
  • Challenges of implementing TCO-based decision making in practice
  • Tools to incorporate measurable risk in decision making, including an introduction to Monte Carlo simulation
  • Tools to incorporate uncertainty, or non-measurable dimensions, including a discussion of heuristic decision making
  • A new approach, co-developed with Sue Helper (former Chief Economist of the United States Department of Commerce), to sourcing decision-making that addresses many of the challenges inherent in TCO

 

This will be an interactive session, targeted toward sourcing, procurement, purchasing, and supply chain managers. General managers will also benefit from the insights.

When: March 9, 2018 (8 a.m. - 5 p.m.)
Where: Ohio State University Fisher College of Business
PRice: 1-2 attendees: $895/person
3+ attendees: $795/person
Registration: Register here

For more information on the program, contact Professor John Gray at gray.402@osu.edu or 614-247-8021.

John Gray Center for Operational Excellence (COE)
Faculty Profile