Speed is an indispensable element in enhancing business competitiveness. If what need to done can be done faster, then it better be done that way is the mantra. So, if sectors like food and airlines, and functions like supply chains and product development can go the ‘fast’ way, why not sourcing? Global sourcing experts are in the process of developing the concept of accelerated sourcing. Though there is no mass following or universal agreement about this yet, the practice is gaining ground in real-life global sourcing situations. 

“Accelerated Sourcing (sometimes referred to as ‘Fast Track Sourcing’) typically refers to a methodology where the process and timeframe to get to contract is compressed. The traditional sourcing method takes between 14 to 18 weeks. The process is compressed by simplifying and fast-tracking the various aspects — statement of work, service-level agreements, pricing, and terms and conditions — of a commercial outsourcing agreement,” explained Thomas Young, Partner and Managing Director, TPI.

Different Approach
The proponents see accelerated sourcing as a response to the market dynamics. “We are reacting to the market need. The current trend is such that the customers don’t have the time, and if we keep pushing them to follow the traditional sourcing process, fewer and fewer buyers would want to outsource,” said Doug Plotkin, Sourcing Leader, PA Consulting.   

How does one cut the slack out of the traditional sourcing process? This is where the perspectives and approaches differ. According to TPI, “The approach an organization takes in accelerated sourcing is not different from the standard sourcing approach. The key is for organizations to have a good understanding of their environment and what areas need most attention and which ones need to be simplified. For example, if the service levels are well understood and tracked, and the organization has a lot of historical data in this area, then much less time needs to be spent on developing and agreeing to service level approaches, calculations and baseline establishment,” explained Young. This also means that accelerated sourcing makes more sense for firms that have been outsourcing services for a while and have the basic understanding of the outsourcing process.

The reason why traditional method works well for the beginners is that it eradicates most of the possible risks. However, this doesn’t mean that accelerated sourcing tends to increase your risks;  it creates more filters at the initial stages such that only the suitable providers reach to the final stages. “The traditional method is very structured and only one step can be taken at a time. Thus the process takes from six weeks to many many months,” added Plotkin.

The Right Candidate
What kind of companies or engagements are more suitable for accelerated sourcing? There are varying opinions on this.

The first school of thought subscribes to the belief that the companies that have been outsourcing for a while are more comfortable with the process of accelerated sourcing. “Within the Fortune 2000, virtually every company has some experience in sourcing services. Many companies have extensive experience. As such, the sourcing approaches by these firms tend to be more sophisticated and, more importantly, built on the organization’s prior experiences. So it is easier for them to adopt the fast path,” said Young of TPI. “And the firms who are looking to initiate outsourcing should go through a more deliberative process so that they understand all aspects of the potential deal.”

The other school of thought opines that maturity in outsourcing is neither necessary nor sufficient. Said Karoor of neoIT, “This is not entirely true. Definitely the companies with better understanding of the sourcing process tend to opt for it more. But the acceptability rate has been almost 70 to 75 percent even by the new entrants to the trend.”

At times, the companies that have been outsourcing for long might find it difficult to imbibe a new process. First-time outsourcers will go for it as it comes with a cost and time advantage. However, the limiting factors for accelerated sourcing are:

• Solution gets developed at a later stage in the lifecycle
• Requires higher degree of coordination/project oversight
• The process is resource intensive.

So the organizations that have the availability of resources tend to go for accelerated sourcing process, irrespective of experience or no experience.