A hypercompetitive business environment calls for newer, innovative approaches to sourcing and procurement (S&P). Low cost country sourcing (LCCS) or best cost country sourcing (BCCS) helps cut costs by sourcing a number of tasks to geographies that are competent while being competitive. However, until now LCCS worked independent of BPM processes. A newer approach is the international purchasing office (IPO) model that capitalizes on the strong synergy between the LCCS and BPM. Here are 6 reasons why IPO is the way forward for sourcing & procurement functions.

1. THE SOURCING AND PROCUREMENT
(S&P) SERIES
6 benets of the
international purchasing
oce (IPO) model
The traditional approach to SP is giving way to newer, innovative approaches – all in an eort to
derive more business value. One example is low cost country sourcing (LCCS) or best cost country
sourcing (BCCS), which until now worked independent of business process management (BPM)
processes. A newer approach is the IPO model that capitalizes on the strong synergy between the
two. Here are 6 reasons why IPO is the way forward for SP functions.
1. LAYS A STRONG
FOUNDATION FOR BPM
2. ENHANCES GLOBAL
SUPPLIER DEVELOPMENT
3. GLOBAL SOURCING TO
COUNTER GLOBAL COMPETITION
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Country-focused sourcing eorts will
make the most of benets available in
the supplier’s native country
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A typical IPO carries out sourcing and
supplier development, and gathers
supplier management information
that lays foundation for BPM in a more
structured manner
6. EXPANDS BPO POSSIBILITIES
The IPO model helps identify and
develop key suppliers across
important sourcing categories
(direct and indirect)
LCCS-enabled category management,
by virtue of being connected to
transactional procurement and other
processes, means more avenues to
eectively utilize BPO services
4. VALUE FROM BEING MODULAR
An IPO can be modularized to the
extent that it is able to form a niche
service oering to the overall source to
pay (S2P) teams in the enterprise
5. END-TO-END CATEGORY
MANAGEMENT
With an IPO, sourcing and procurement
functions can benet from fully
engaged category experts and quality
assurance teams