When someone counts their change at the bakery, they are using mathematics. Nobody would put it that way, and for that particular task, a reasonable intuition for numbers does the job perfectly well.

When people talk about sourcing performance, the conversation often moves quickly to the negotiation itself. How do we create competitive pressure? How do we improve supplier offers? How do we get to the best possible outcome of the final negotiation?

Those questions matter. But in many of the more complex sourcing situations we see, a lot of the achievable value can already be gone before the negotiation begins. This is especially true when new technologies, unfamiliar suppliers or fundamentally different concepts are involved. Procurement is no longer comparing like with like. There are more trade-offs, more stakeholders and often more uncertainty.

The natural reflex is to simplify.

A familiar solution gets preferred. A detailed specification is defined early. The number of alternatives is reduced, and the process becomes easier to manage. BUT it also means that options disappear before there is enough information to properly compare them. By the time the negotiation starts, the competitive landscape is very likely much smaller than it could or should be.

Keep the solution space open long enough

The point is not to keep every option alive forever.

It is to avoid locking in a supplier or concept before you really understand the solution space. That means being prepared to look beyond familiar suppliers and solutions, and keeping genuinely different concepts in the process long enough to understand what they can offer. A clear timeline and decision points still matter. Keeping the solution space open does not mean postponing decisions. It means making them when you have enough information behind them.

Compare value, not only price

Keeping different concepts alive creates another challenge: how do you compare them fairly?

Different solutions come with different prices, but also different levels of performance, risk, flexibility and future potential. If the decision is reduced to quoted price, much of that value disappears from the comparison. The challenge is therefore to create a common basis on which genuinely different solutions can compete. Getting this evaluation right is an important part of maintaining competition until the final decision.

Organise the internal game first

This is also where complex sourcing often becomes difficult.

Different functions and sites have their own preferences, targets and established ways of working. Without alignment, there is a strong tendency to narrow the field back to what is already familiar. This internal work needs to happen early. Stakeholders need to understand where the process is going, which questions need to be answered and how decisions will eventually be made. Only then can you credibly design the external competition.

What this can mean in practice

In our recent webinar, I shared an example from a logistics company sourcing transport vehicles across several sites while new technologies were entering the market. Electrification, automation and very different supplier solutions made the decision complex. At the same time, the individual sites already had established processes and suppliers they knew well.

It would have been easy to reduce that complexity early and stay close to what was already familiar. The project took a different route.

The result was a double-digit improvement in the overall business case.

Of course, the result did not come from simply keeping more suppliers around for longer. The important part was how the process was prepared, how different solutions were evaluated and how the competition was designed. That is where much of the real work happens, and where much of the value can be won or lost before negotiations with suppliers even start.

If you’re facing similar questions in your sourcing organisation, feel free to connect with me. I’d be interested to hear how you are approaching them.

Please note: The image used in this article was created with the assistance of AI.