STRATEGIC SOURCING

A System-wide, Collaborative Purchasing Process

Strategic Sourcing

To develop and implement an effective system-wide, collaborative purchasing process designed to maintain or increase customer satisfaction (by enhancing product quality and service levels) and significantly lowering total cost by coordinating and leveraging common purchases across the UC system.

MISSION

Strategic Sourcing

Complete Customer Satisfaction.Continuous Improvement of Internal

Service Levels and Product Quality.Process Excellence. Significant Total Cost Reduction

(5%-15% Target).

Goals

Strategic Sourcing

Visible, Active Executive Sponsorship– A Single Vision– Internal Cooperation and Participation

End User Focus and Involvement– Clear Understanding of User Requirements– Use of Cross Functional/Departmental Teams

Data Integrity– Rigorous Analysis– Fact Based Decisions

Appropriate Use Of Technology– Internet Enabled E-Procurement– Solid, Reliable System Infrastructure

Continuous Process Improvement– Establish Best Practices/ Key Performance Indicators– Constantly Measure Results and Implement Improvements

CRITICAL SUCCESS FACTORS

Road Map

INCREASED CUSTOMER SATISFACTION and

SIGNIFICANT COST REDUCTIONS

Technology

Implementation of Best Practices

Identify/Prioritize Opportunities

Establish User requirementsExecute RFP Process/Select Supplier

Develop Timely and Accurate View of Spending Data

Simplify and Stream-line Processing (P-Card)

E-Procurement Development

Strategic Sourcing

Products and Services

Processes

Rationalize Current Specifications

Evaluate New/Alternative Products

Identify Non-Value Activities

Best Practices Analysis

Business Process Analysis

Implement Continuous Improvement Practices/Metrics

Conduct Spend Diagnostic

Launch Cross Functional/Divisional Teams

MISSION STRATEGIES TACTICS

Monitor Compliance

Collaborative Purchasing Process

Current Teams

Purchasing Card (P-Card) Office Products ($25mm) UC Press ($10mm) Fed X ($10mm) Fitness Equipment ($3mm) Lab Supplies ($120mm) Appliances (under evaluation) Dormitory Furniture (under evaluation)

Commodity Groups

Athletic & Recreational Supplies Auto Rental Business Equipment Computer Equipment &

Maintenance Computer Supplies Computer Software Departmental Stores Entertainment Services Environmental Services Explosives and Firearms Food Services Freight and Shipping Service &

Supplies Furniture (office and housing) Laboratory Supplies & Equipment Pharmaceuticals Printing Services

Maintenance/Repair/Operations Medical Equipment Medical Services Medical Supplies Miscellaneous Equipment Miscellaneous Services Miscellaneous Supplies Multimedia Supplies Office Supplies Professional Services Security Site Maintenance Telecommunications Equipment Temporary Services Theater Supplies Travel Utilities

Major Commodity Relationship Groups

Professional Services– Professional Services– Temporary Services

Miscellaneous– Utilities– Misc. Equipment– Printing Services and Supplies– Furniture– Business Equipment– Freight & Shipping Supplies– Misc. Other, Includes:

• Athletic & Rec. Supplies• Auto Rental• Collections• Departmental Stores• Explosives & Firearms• Literary Services• Medical Equipment• Misc. Supplies• Site Maintenance• Theater Supplies

Services– Medical Services– Food Services– Entertainment Services– Travel– Misc. Services– Security– Environmental Services

Supplies– Laboratory Supplies– Maintenance/Repair/Operations– Medical Supplies– Multimedia Supplies– Office Supplies– Pharmaceuticals

Telecommunications/Computer– Computer Equipment– Computer Supplies/Software– Telecommunications Equipment/

Services