Strategic Sourcing Assignment Example | Topics and Well Written Essays - 1000 words

Strategic Sourcing - Assignment Example For instance, fluctuation of prices and global crisis are factors that create a lot of problems to running of companies via sourcing. Owing to this fact, employee and customer satisfaction are as well evident. From the article Boeing Faster, faster, faster in The Economist magazine, it is evident that most supplying companies show tendencies of consistently failing their customers. This result to demand for production services overwhelming many sourcing companies hence customers cancellation of business deals. This theme of in-sourcing is also evident in the article below: As much as outsourcing helps in saving on costs, it is associated with a lot of challenges which attributes the sourcing companies being unreliable. According to Wagner, & Boutellier (2002), small firms in the US lose the chance for supplier savings beyond $134 billion as a result of insufficient sourcing capabilities. It is thus evident that strategic sourcing is based on two factors which include operational and structural risks. On the operational risks, there are beneficial factors like price upgrading, cycle time reduction, upgraded inventory returns, transaction decrease, elevated services heights, inventory decrease and upgraded quality programs. On the structural risks, there are factors that include advanced profits, viable positioning, advanced reactions period to market state, employment of seller capability, outsourcing probability and authentic partnering with sellers. In order to ensure that companies receive great services, it is comparatively better to in source prod ucts and services. This will guarantee swift production and customer satisfaction at all times. This alternative however, limits the companies from obtaining diversified services and at times may be expensive to manage. There are some products/services that cannot be readily available within the company. Therefore, this implies that, companies may still find the