Direct materials procurement strategy
Sourcing IQ, a supply chain consulting firm, specialises in strategic sourcing for direct materials. Since its inception five years ago, the company has been transforming procurement processes for mid-sized private equity (PE) groups and manufacturing companies.
Sourcing IQ's expertise is delivering training to upskill procurement teams, and providing strategic sourcing and project management services to execute outsourcing and resourcing projects for their clients.
Recognising the need for efficiency and transparency in executing client projects, Sourcing IQ formed a partnership with Market Dojo. This collaboration has been instrumental in delivering cost savings and streamlined processes for their clients.
We chatted with Mary Ruth Williamson, Founder and CEO of Sourcing IQ, to discover what's made the strategic partnership work so well.
Challenges
A need for speed (and transparency!)
Many of Sourcing IQ's clients, large and small, rely heavily on manual methods such as phone calls, emails and spreadsheets to manage their sourcing tenders.
"Our clients typically do everything manually—emails and spreadsheets to gather quotes. This is time-consuming and prone to errors."
With an increasing demand from clients for value creation and supply chain consolidation, Sourcing IQ needed a robust platform to execute large-scale resourcing and outsourcing projects effectively.
Audit trail and transparency
Another challenge is the ability to maintain a clear audit trail allowing Sourcing IQ to give their clients full transparency throughout the Request for Quotation (RFQ) process.
What Our Clients Say
Market Dojo is game-changing for creating efficiencies and enhancing results for a strategic sourcing team.
Solution
A thriving partnership
After a brief trial, Sourcing IQ adopted Market Dojo Sourcing, its flagship e-sourcing software, to enhance the execution of client projects. The primary objectives were to streamline RFQ processes, deliver value to client companies, and minimise environmental footprints.
"Market Dojo Sourcing has allowed us to streamline our processes and get RFQs out to market more quickly."
"It gives us a thorough audit trail—which is terrific for us because we can see that all the suppliers get the exact same information, when they get it and when they've opened it."
"This has really increased our efficiency and allows us to focus our time more on the strategic side of negotiating with suppliers, and less time on administering the RFQ—which Market Dojo Sourcing does for us now," says Mary Ruth.
'Exceptional' service levels
"If we have questions about how we could use the tool better, the response time from Market Dojo is exceptional. If the chat team can't resolve it, our account manager steps in and resolves it within minutes or hours. I've never had this response time from a SaaS tool that I've used."
Mary goes on to explain why this matters for procurement consultants: "We work on a project-based fee so if we exceed our hours it comes out of our profit. The efficiency the software provides, as well as the awesome support we get from Market Dojo, helps us to make sure we're not spending hours on lag time or trying to figure something out."
Results
Transformational savings
Mary Ruth highlights two specific projects with remarkable results supported by Market Dojo Sourcing.
Resourcing project: Aerospace
An aerospace client who faced market pressures from their own customers challenged Sourcing IQ to take their externally sourced machine parts and create value via cost reductions and supplier consolidation.
The results: 465 machine parts, $8.1 million baseline spend, $3.6 million cost savings (44%) by consolidating suppliers and leveraging competitive RFQs, plus an additional $1.5 million working capital savings by using Market Dojo's tools.
"We started with an RFP through Market Dojo Sourcing, then took that into an RFQ and we were able to get those savings which was amazing."
This is a total of $5.1M in cost savings and working capital benefits negotiated over a five month period.
Outsourcing project: Instrumentation
The second project had equally outstanding results: 193 instrument parts, $7.4 million baseline spend, $2.7 million cost savings (36%) by outsourcing supply and helping the client close three internal machine operations to reduce their environmental footprint.
"For this project we went straight to RFQ. It took three to four months and in addition to the savings, the client was able to reduce its footprint by closing three of their internal machine shops."
Positive supplier feedback
Sourcing IQ ensured smooth adoption by preparing suppliers in advance with training materials and initial support.
"One supplier is now using Market Dojo themselves. They liked the capabilities so much that they signed up to use the platform with their own supply base."
Key lessons learnt
For organisations considering digital transformation in sourcing, Mary Ruth offers this advice:
"First of all, prep your suppliers because using a tool like Market Dojo will likely be new for them."
"Second, from an internal point of view, involve your team as collaborators. Leverage this functionality so that your whole team can answer supplier questions quickly. This ensures things are more efficient, idle times are reduced, and RFQs have faster cycle times."
And lastly...
How would you sum up Market Dojo?
"Market Dojo is game-changing for creating efficiencies and enhancing results for a strategic sourcing team."