For strategic sourcing managers, procurement is about more than simply finding the lowest price. It’s about seeing the big picture. It’s what makes this position unique. Indeed, strategic sourcing managers must understand, predict and prepare for the ripple effect of procurement, focusing on how to amplify and optimize the value of every vendor engagement.
Strategic sourcing, as an approach to procurement, has been around since the 1980s. However, roles dedicated to the practice are relatively new. In fact, the strategic sourcing manager title has steadily been gaining prominence over the last decade. Consequently, I’ve noticed more of these titles in my day-to-day work, as I talk with procurement professionals looking for RFP software to improve their processes.
Throughout this post, we’ll explore the strategic sourcing manager job description and their role in the procurement team. In addition, I’ll offer an overview of the responsibilities and skills of the role so you can decide if you’re a good fit for this challenging and rewarding career. And finally, I’ll conclude with helpful tools and resources for rookie and veteran sourcing managers to hone their skills.
What is a strategic sourcing manager?
- Definition: Strategic sourcing manager job description
- Role within the procurement team
What does a sourcing manager do?
- Primary responsibilities
- Crucial sourcing manager skills
Key procurement tools and resources
- Procurement tools and templates
- Networking and news
- Professional development resources
What is a strategic sourcing manager?
Definition: Strategic sourcing manager job description
A strategic sourcing manager selects, evaluates and manages vendor partnerships. They use these relationships, along with data analytics, to problem solve and achieve business goals.
As the role evolves and becomes more common, some shorten the title to sourcing manager because the ‘strategic’ portion is assumed. As you might expect, the role focuses on using strategic sourcing principles in the procurement process. Accordingly called strategic sourcing management, they consider each factor that influences a vendor’s overall value.
For example, in addition to the cost and quality of a product or service, they take into account the benefit or risk of partnering with a vendor, their reliability, the long-term compatibility, intangible value and much more. Ultimately, the goal is to maximize value and minimize risk.
Strategic sourcing manager vs. procurement manager
So, what’s the difference between a strategic sourcing manager and a procurement manager? The answer will depend on the size of the business and maturity of their procurement team. Today, the strategic sourcing title is most often found in large enterprise businesses. In this situation, it is a mid-level management position typically focused on indirect spend. The position manages processes and policies while guiding the work of procurement managers.
However, I have also found a growing number of small- and medium-sized businesses use the title synonymously with the traditional procurement manager title. The shift in terminology is significant because it speaks to the individual organization’s procurement philosophy. At the same time, the change may show an industry trend — the move from tactical to strategic sourcing.
Role within the procurement team
Generally, strategic sourcing managers are a part of the procurement team within the finance and operations department. However, as mentioned above, the specific hierarchy of roles varies greatly from one business to another.
Generally, strategic sourcing managers report to the director or vice president of procurement, supply chain director or the chief procurement officer. In addition, depending on the size of the business, they may work alone or manage a team of direct reports. In short, it all depends.
Strategic sourcing career path
Most strategic sourcing managers move into the position after at least three years in another procurement role. For instance, many start their career as a category manager, procurement manager, sourcing specialist or supply chain manager before growing into the strategic sourcing role. In addition, you’ll find a variety of levels of education in a strategic sourcing resume.
Some practitioners will have higher education qualifications like a bachelor’s degree in supply chain, logistics, finance, accounting or business administration. Alternatively, many gain on the job experience and grow into the position.
Opportunities to advance abound for successful strategic sourcing managers. Like many procurement careers, the role develops an understanding of the vendor relationships as well as big-picture objectives and business strategy. Likewise, they benefit from close, collaborative relationships with executives and stakeholders. The experience and visibility naturally lead to advancement. Indeed, many move on to become a senior strategic sourcing manager, director of sourcing strategy or vice president of strategic sourcing.
What does a sourcing manager do?
Primary responsibilities
Develop procurement policies
- Establish, analyze and optimize the business’s procurement strategy ensuring alignment with business goals
- Manage the company’s procurement policy
- Define e-procurement processes and digital transformation initiatives
Lead collaboration with stakeholders and internal teams
- Partner with stakeholders, executive leaders and department heads to understand business needs
- Establish requirements, scope and criteria for procurement projects
Manage vendor selection
- Leverage RFx tools to facilitate strategic sourcing and manage the RFP timeline
- Lead initial market research and vendor profiles to aid supplier selection
- Create, issue and manage RFPs in a digital RFP management system. Manage proposal evaluation and final vendor selection.
Explore the RFP process in more detail: Download the RFP process guide.
Build ongoing vendor relationships
- Use supplier relationship management best practices throughout negotiation, contracting, onboarding and renewal
- Conduct regular vendor performance evaluations and supplier risk assessments
Analyze procurement data
- Collect and interpret procurement data including cost analysis reporting
- Benchmark spend, RFP data and return on investment
Optimize procurement processes
- Perform regular reviews of established procurement processes to ensure continual improvement
- Refine policies, due diligence questionnaires and RFP templates
Crucial sourcing manager skills for success
A wide range of skills are required to fulfill the responsibilities of the strategic sourcing role. Certainly, there are many traditional, straightforward hard skills involved, but there are also a number of nuanced, but still crucial, soft skills needed for success.
Hard skills
- Contracting and procurement negotiation
- Risk management
- Strategic sourcing software experience
- Business ethics and transparency
- Forecasting and planning
- Category management
- Project management
- Data analysis
- ROI evaluations
Soft skills
Relationship and conflict management
Working with vendors isn’t always easy. Often, it will seem like you’re at odds. However, navigating these tricky situations with tact and respect will yield positive results.
Adaptability
Unfortunately, business needs aren’t always predictable and are often urgent. Consequently, flexibility is essential to success.
Strategic thinking and creative problem solving
Along with being adaptable, creativity is key. Sometimes you can solve problems with existing resources and vendors. Sometimes an unconventional solution is also the most cost effective.
Communication and collaboration
You need to know how to ask the right questions to get the most useful responses. First, as you work with internal stakeholders to determine what they need. Then, in RFPs issued to vendors.
Thought leadership and application of industry concepts
Procurement is constantly evolving. Strategies change frequently and you must be able to interpret trends and understand how they can be leveraged to benefit your business.
Attention to detail
As anyone who works with contracts knows, the devil is in the details. You must be able to navigate dense, complex documents and then advocate for your business.
Time management
There will always be a list of competing priorities for strategic sourcing managers. From new procurement projects and optimizing processes to vendor evaluation and compliance initiatives, you must strike the right balance.
Strategic sourcing manager job description and resume examples
Often, the best way to really understand what a strategic sourcing manager does is to see it in action. These strategic sourcing manager job descriptions can help you envision what an organization is looking for.
Key procurement tools and resources
Strategic sourcing managers rely on a number of tools and resources. Accordingly, familiarity with these tools will give you a leg up as you seek strategic sourcing manager opportunities.
Procurement tools and templates
- RFP management software
- Enterprise resource planning (ERP) systems
- Vendor profile template
- Request for quotation (RFQ) template
- Guide to the request for information (RFI)
- Request for proposal template best practices guide
Networking and news
- Procurious – Social network
- Sourcing and Procurement – LinkedIn group
- The Strategic Sourceror – Procurement blog
- Supply Chain Dive – Procurement publication
Professional development resources
Many strategic sourcing manager job descriptions list a preference for candidates with project management and procurement certifications. Explore more about the most common certifications with these resources.
- American Purchasing Society: Purchasing professional, purchasing manager, green purchasing and purchasing consultant certifications
- Chartered Institute of Procurement and Supply: Six qualifications for various skills and levels of expertise
- Institute for Supply Management: Procurement and supplier diversity certifications
- Six Sigma: Green or black belt and lean process methodology certification
In the future, the practice of strategic sourcing will continue to grow as businesses prioritize more meaningful vendor relationships and long-term value. Consequently, it seems that strategic sourcing roles are here to stay.
To learn more about the future of procurement and RFPs, explore insights from experts in the Future of RFPs ebook.
Originally published December 3, 2020 — Updated January 19, 2023