When Linda Tuck Chapman started sourcing services from around the world 11 years ago, sourcing wasn’t even considered a profession. But she was fortunate enough to be working for companies that considered sourcing critical enough a decade ago to even have executive titles that reflected their sourcing functions — back in 1996 at Bank of Montreal Tuck Chapman was Director, Sourcing.

Tuck Chapman is one of the few global sourcing professionals who have “grown up” sourcing services. In the late 1990s, she had set up the global sourcing office at the Scotiank Group and today at Fifth Third Bank, she is SVP and Chief Sourcing Officer, responsible for leveraging in excess of $1.5 billion in third-party arrangements. Some of the key relationships that she manages are with Wipro, i-flex and Cognizant in India, Teletech in the Philippines, and the Resolve and Royal Bank Financial Group in Canada.

Few people sourcing IT and business services from around the world today can boast of such experience. Most are IT professionals, who find themselves negotiating with service providers over IT contracts and some even come from the procurement function; few come from the business.

“Global sourcing is still an emerging profession,” says Tuck-Chapman. “Many, many companies still either don’t appreciate the values that a sourcing officer can bring or they are trying to use the procurement office.”

Who’s Your Global Sourcer?

There is no doubt that companies are seeing the global sourcing of services as critical to their profitability; yet few have understood the staffing requirement for their outsourced projects.

Companies such as HSBC, Dell, Aviva, Pfizer and British Telecom have corporate global sourcing offices, responsible not just for managing the sourcing transaction and relationships but also for the global sourcing strategy. Such firms understand that they have a responsibility toward their sourcing engagements and that they just can’t forget about their outsourced full-time employees and processes. They staff their sourcing offices with program-management and governance skills.

At the same time, some companies make do with their procurement staff masquerading as global sourcers. While procurement staff is great at arm-twisting laptop vendors into renegotiating pricing on bulk purchases, their book of negotiation tricks may not work in sourcing business services, and that too from distant parts of the world. They typically don’t have the skills — and the acceptability by the business groups — to identify new processes to be outsourced, navigate through the internal business groups, develop providers into partners, share industry best practices with the providers, etc.

How a company chooses to staff its sourcing office depends on how strategically it views its global sourcing. This determines both the attitude of the senior management toward staffing, and equally importantly, the budget allocated to it. Often, getting a procurement person involved in sourcing services is a matter of convenience — it’s easy for companies to ask the person who has been purchasing hardware and software to also purchase services.

“A procurement person goes and gets stuff cheap. He will not be accepted in a critical role,” says Hemant Puthli, Senior Director, neoIT. “Procurement people understand tax structures and contracts well. So they are involved in the sourcing process, but they cannot be responsible for it.”

From left to right: Jim Bowman, Harry Brandicourt,
Linda Tuck Chapman, Tom Palermo, Linda Ivy Rosser

GLOBAL SOURCERS AT FIFTH THIRD The bank has four teams of 23 global sourcers led by Linda Tuck Chapman, SVP and Chief Sourcing Officer. Here’s what they do Strategic Sourcing Lead by Harry Brandicourt, VP, Strategic Sourcing Create financial and non-financial value for new third-party relationships Lead sourcing processes to enable business goals  Structure third-party relationships to mitigate risks. Sourcing Demand Management Lead by Jim Bowman, VP, Sourcing Demand Management Lead sourcing process for renewing existing relationships Manage internal demand by influencing quantity, frequency, price, processes and specifications Ugrade sourcing processes and tools  Lead implementation of projects, enabling visibility and control of spend.  Sourcing Governance Lead by Tom Palermo, VP, Sourcing Governance Enable a risk-centric sourcing program Ensure that outsourcing procedures are in compliance with regulatory requirements Support the bank’s outsourcing services and governance processes. Global Sourcing Program Lead by Linda Ivy Rosser, VP, Global Sourcing l Translate the bank’s strategy into actionable “smart sourcing” strategyLead and manage program implementation l Lead and manage “smart sourcing” programs.