Overview

What is strategic sourcing?

•  The Office of Management and Budget has defined strategic sourcing as, "The collaborative and structured process of critically analyzing an organization's spending and using this information to make business decisions about acquiring commodities and services more effectively and efficiently.

Why is it important?

•  In 2005 the Office of Management and Budget directed all federal departments and agencies to develop and implement a strategic sourcing program. The Air Force reports status every year in an annual report that gets consolidated at the DoD level and is then sent to OMB.

•  Strategic sourcing helps alleviate some of the issues currently surrounding AF contracting.

o  Inconsistent use of skilled contracting resources

o  Strain on buying activities supporting contingency contracting

o  Redundant procurement of similar commodities (supplies and services)

o  Inability to leverage scale of the Air Force to drive efficiencies

o  Increase in contracting workload and complexity

o  Significant decrease in journeyman-level personnel and experience

•  In 2009, OMB issued a memo directing agencies to "expand their use of enterprise-wise strategic acquisition initiatives that offer significant savings opportunities from both business process improvements and access to lower product and service costs which would reduce the total cost of ownership to the Air Force."

What does strategic sourcing mean to the Air Force?

•  The Air Force knows that strategic sourcing is a process and there are various possible outcomes and strategies that are determined as a part of that process. Figure 1 is a graphic of the Air Force strategic sourcing model. This model has also been adopted by OSD. Each strategic sourcing effort should follow this process, whether it is an AF-wide, commodity council, MAJCOM specific or other type of strategic sourcing effort.

What is the purpose of this IG?

•  The purpose of this AF Strategic Sourcing and Commodity Council Guide is to document the processes required to develop and sustain strategic sourcing teams and commodity councils. The Guide provides information regarding commodity council/strategic sourcing team structure and governance, roles and responsibilities and a general process flow for team implementation and operations. The Guide is meant to provide a roadmap but each council may have unique aspects and each council may tailor this guide to meet their needs. The Guide includes a listing of the required information for several deliverables, as well as tool examples that a commodity council/strategic sourcing team may find useful.

What is a commodity council/strategic sourcing team?

•  A commodity council/strategic sourcing team is a cross-functional group of individuals responsible for the development of AF or MAJCOM-wide sourcing strategy for a particular commodity (a defined category of supplies or services)

See https://cs.eis.af.mil/airforcecontracting/Strategic%20Sourcing/Communications%20and%20Briefings/

Figure 1: Air Force Strategic Sourcing Model