Help wanted: Leveraging outside expertise to drive packaging excellence

By Barbara Moser, practice leader of global packaging, Procurian in Supply Chain on May 31, 2013


Brand owners are feeling the squeeze from all sides these days. On one hand, they must drive market growth in new and existing channels by tailoring packaging to customer preferences. On the other hand they are facing pressures to do more with less, either containing or reducing costs.

 

Forward-thinking organizations are now taking a strategic approach to satisfying these dual objectives. Among the many options available is the leveraging of specialists who apply unique expertise and supply market insights to support leading-edge innovation while helping to optimize indirect spend that can be used to help grow the bottom line. Specialists can provide immediate access to intelligence, accelerating time to value, and eliminating the need to build and sustain the same level of expertise in-house.

 

Few but the largest global firms can internally assemble teams with leading-edge depth and market intelligence in every area, and, even then, they can miss the benefits of outside-in perspective. For mid-tier and smaller companies it is often economically infeasible to develop the required depth of expertise in every area.

 

Whether a brand owner's strategy is to exclusively use internal resources, or external resources, or a hybrid mix, strategy should be centered on building the team that can deliver on the following objectives:

 

• Achieve minimal cycle time from design to prototype to first-time market introduction.

 

• Ensure resource availability to overcome demand spikes and product transitions.

 

• Deliver real-time market intelligence around pricing trends to capture and sustain optimal costs.

 

Centralize fragmented spend and processes to maximize cost advantage and speed-to-market.


In evaluating internal capabilities and potential external partners, consider the following criteria:

 

• Market/Global Intelligence spanning supply market knowledge, deep intelligence and insight into market cost drivers is the foundation of competitively advantaged sourcing strategy. Global reach and an understanding of local supply bases are critical differentiators in today's marketplace.

 

• Should Cost Models: The use of analytics that combine deep understanding of value stream elements and drivers, as well as real-time market dynamics, sometimes at the level of a specific supplying plant, can provide unique advantages when preparing for negotiations and analyzing proposed price movements.

 

• Relevant Technical and Industry Expertise: This type of expertise is an increasingly rare but critical commodity for rapid development, testing, specification and right-first-time launch support.

 

• Execution Resources: At the sourcing stage, request for information or proposal (RFI or RFP) efforts can drain resources, diverting attention away from core business priorities and growth initiatives.

 

• Continuous Improvement: The sourcing process is only part of ensuring the best overall cost. Often once a contract is finalized, the work shifts to the next priority. Ongoing efforts to work with the supply base and internal partners to find additional savings and efficiencies on awarded business provide mutual benefit to the customer and supplier.

 

By leveraging the optimal pool of resources you can enhance your competitive position through faster time to market, and the ability to ramp up and ramp down capability as needed-all while optimizing and minimizing related cost drivers.

 

Author Barbara Moser is the practice leader of global packaging at Procurian (www.procurian.com), the leading specialist in comprehensive procurement solutions. The company's built-out Specialized Procurement Infrastructure integrates with businesses to optimize spending and deliver real savings that equal a margin point or more.

 

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