— ALEX SARIC , Chief Marketing Officer , Ivalua

adapt over time to become smarter when it comes to procuring goods and services . This is always about finding a balance – for example , Google prefers to diversify its suppliers as much as possible , selectively working with only those who can provide innovative products that will work for them . But this approach isn ’ t universal .

Too often when creating a product , costs play the deciding factor when selecting suppliers to provide components and services . It ’ s assumed that all well – ranked suppliers are equally capable of meeting the New Product Introduction ( NPI ) project requirements .

At times , this plan can work out fine .

However , there are significant potential trade-offs with such a focus . In cases where the supplier evaluation is incomplete , or the team fails to include available data such as performance or risks in the supply decision , the company puts their NPI launch at risk . Some examples of supply issues include suppliers lacking the necessary capital for equipment , a history of late deliveries and poor-quality processes , as well as inexperience with a material or a technically demanding manufacturing process .

Furthermore , a cost focus creates pressure on the margins of those suppliers winning a bid . This may help bolster overall profitability of the final product , but it also reduces an organisation ’ s desirability of a customer . In

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