— Sandeep Arora , VP Global Sourcing & Strategy , SPX Transformer Solutions

SCM strategy , in which we assess how we qualify , evaluate and classify our suppliers . We also ensure that we have dual sourcing in place , so that we are not caught unaware when a single source supplier is no longer viable on QCD ” says Arora .

Then we must talk about people – to implement any strategy , we need engagement of our employees . People can become a major challenge if not involved at the right time as before introducing new suppliers manufacturing employees need to be ready to accept and manage the change effectively . For achieving this , first and foremost we need to select and upskill the right staff by providing carrier paths through functional development . Finally , we look at organization structure and business intelligence to get optimum benefits by aligning SCM strategy to our business strategy .

For SPX Transformer Solutions , SCM strategy is more than just a buzz word – it ’ s a habit that defines the business ’ culture and enables continuous improvement . According to Arora to drive sourcing excellence initiatives , “ continuous improvement should be embeded in the culture of organization .”

Ultimately , the business aims to improve operational efficiency , which Arora claims can be achieved within these three functions in an organization : one is through redesign to cost , which is led by engineering , the other is productivity improvement , which is driven by manufacturing and the final one is sourcing efficiencies driven through a sourcing excellence framework . In regards to the financial impact , as Cost Of Goods Sold ( COGS ) is the largest contributor to transformer operational cost , and therefore the biggest opportunity to improve COGS lies in the sourcing bucket .

To implement a successful SCM

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