Emphasis on sourcing is not something new within the business environment. A research institute conducted a study on strategic sourcing for 25 senior operation managers in the United States of America, and concluded that “the one dictum that would still be valid a half-a-century from now is the policy of buy low, sell high”. Strategic sourcing is not necessarily the act of buying low and selling high, rather it looks in to the sustainability of what was bought low and equally the sustainability of what was sold high. Majority of today’s businesses, only look for opportunities to make fast cash without having a second thought on the consequences of their operations in the future. Strategic sourcing is primarily about the first part of this lecture.

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DEPARTMENT OF BUSINESS AND
MANAGEMENT STUDIES
CHAPTER 1: INTRODUCTION TO THE CONCEPT OF SOURCING
PROGRAMME: M.B.A
COURSE TITLE: STRATEGIC SOURCING AND
MANAGEMENT
COURSE CODE: SCMM712
TOTAL CREDITS: 3
BY
NGANG PEREZ
(MAJOR 1)
PAN AFRICAN INSTITUTE FOR DEVELOPMENT-
WEST AFRICA (PAID-WA) BUEA
LECTURE NOTES FOR STRATEGIC
SOURCING AND MANAGEMENT

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LECTURE NOTES FOR STRATEGIC SOURCING AND MANAGEMENT
PROGRAMME: M.B.A
COURSE TITLE: STRATEGIC SOURCING AND MANAGEMENT
COURSE CODE: SCMM712
TOTAL CREDIT: 3
TOTAL LECTURE HOURS: 15
LECTURER: NGANG Perez (MAJOR 1)
A. COURSE OVERVIEW AND OUTLINE
1. Course Description:
This course is structure to improve students understanding on how to develop and implement a
sourcing strategy that aligns with the procurement strategy as well as the overall competitive
strategy of the firm. Strategic sourcing enhances effectiveness, efficiency and value, ultimately
impacting the profitability of the entire organization. Thus, the course introduces the concept of
sourcing and explains the fundamentals of strategic sourcing. It analyzes the buyer supplier
requirements for sourcing and establishes the key elements for a supply base assessment. At the
completion of this course the students will have the tools and techniques to find the right vendors
and maintain the right relationship with any existing supplier.
2. COURSE OBJECTIVES: By the end of this course, student should be able to:
➢ To Analyze issues involved in locating warehouses
➢ To Establish the basic concept of sourcing
➢ To develop the procurement process
➢ Outline why the strategic interest of sourcing to Business and Society
➢ Understand strategic sourcing from an African buying perspective
➢ To outline the Supplier Selection Criteria
3. COURSE SCHEDULE AND TOPICS
This course will cover the following topics in 5 learning sessions with one session per week as
follows:
PAN AFRICAN INSTITUTE FOR DEVELOPMENT-
WEST AFRICA (PAID-WA) BUEA

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Week 1: Session 1/Chapter 1: INTRODUCTION TO THE CONCEPT OF SOURCING
Date:
Topics
• Strategic Sourcing: Africa’s Business Perspective
• What is Sourcing?
• Procurement
• Specifications development
• Supplier research and selection
• Incoterms (overview)
• Key Account Management
• Review Questions
4. General Course Review and Final Exam Preparation
Date:
Topics
• Chapter 1: Introduction to the Concept of Sourcing
5. Other Requirements
➢ Required Text Books
❖ Porter, M. E. (2008) “The Five Competitive Forces That Shape Strategy”, Harvard
Business Review, January, pp. 1-18.
❖ Gadde, L. and Håkansson, H. (1993), “Professional Purchasing”, London: Routledge.
❖ Kraljic, P. (1983) “Purchasing Must Become Supply Management”, Harvard Business
Review, vol. 61, no. 5, pp. 109-117
❖ Quinn, J. B. and Hilmer F. G. (1994) “Strategic outsourcing”, Sloan Management Review,
Summer, pp. 43-55.
➢ Important weblinks
❖ https://www.sourcingint.com/
❖ https://www.cips.org/en-cn/book.../handbookoflogisticsanddistributionmanagement/
❖ https://www strategicsourcingsummit.com
B. COURSE EVALUATION
• Written Assignment 15%
• Graded Quiz 10%
• Discussion Assignment 5%
• Final Exams taken on Campus 70% total 100%
C. LECTURE NOTES (next page)

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WEEK 1:
SESSION 1/ CHAPTER 1 INTRODUCTION TO THE CONCEPT OF SOURCING
1.0 Brief Introduction:
Emphasis on sourcing is not something new within the business environment. A research institute
conducted a study on strategic sourcing for 25 senior operation managers in the United States of
America, and concluded that “the one dictum that would still be valid a half-a-century from now
is the policy of buy low, sell high”. Strategic sourcing is not necessarily the act of buying low and
selling high, rather it looks in to the sustainability of what was bought low and equally the
sustainability of what was sold high. Majority of today’s businesses, only look for opportunities
to make fast cash without having a second thought on the consequences of their operations in the
future. Strategic sourcing is primarily about the first part of this lecture.
1.1 Learning Objectives
By the end of this session, students should be able to:
• Define and briefly explain what is sourcing
• Outline the procurement process
• Determine standards
• Classify the types of incoterms
1.2 Definition of Key Terms
(a) Sourcing: It is the process of finding the appropriate suppliers of goods or services to satisfy
a certain want.
(b) Logistics: Logistics is the planning, control and execution of the procurement. Logistics takes
over after the product has been purchased.
(c) Incoterms: Incoterms or International Commercial Terms or trade terms are a series of pre-
defined commercial terms published by the International Chamber of Commerce (ICC) relating to
international commercial law.
1.3 Main Content
A naïve manager may be tempted to approach sourcing as a routine purchasing activity. But
sourcing is increasingly recognized as strategic area in management and other business
departments. It may be encountered in several avatars, such as; marketing, sales, logistics, strategic
purchasing, finance and accounting, industrial security or special operations in business-to-
business (B2B) marketing. In Africa, the concept has not been sufficiently publicized and thus
industries see it from a microscopic perspective.
This chapter serves as an introductory manual, stressing the significance of sourcing in business
within the African setting, giving the challenges of doing business in Africa. It will equally

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highlight the principles of sourcing for policy issues, motivating students to see possible careers
and job creation from this study.
1.3.1 Strategic Sourcing: Africa’s Business Perspective
Whilst the rest of the World is strategically sourcing from Africa for long term economic
development, Africans are generally buying from the rest of the world for short term gain” …
Professor Douglas Boateng---CIPS Seminar Botswana--2012
Like all business functions, purchasing does not operate in a vacuum. Success is dependent upon
well-trained, professional sourcing specialists who work in concert with other organizational
functions to attain the company goals. It is also dependent upon understanding the future direction
of the specific business, the business climate in general, and the strategic initiatives required to
meet the organization’s goals. Globally it a challenge to all business wishing to operate
successfully.
In Africa, the case is different. A typical business unit will encounter the following challenges;
Logistical and other infrastructural challenges, Red tape, Currency challenges, Relatively
Ineffective Institutions, Power challenges, Skills challenges, profitability challenges, Counterfeit,
Conflict and Political instability, Boarder challenges, Travel challenges, Language challenges,
Self-confidence and entitlement culture, bad administration & Corruption challenge, Water &
electricity challenges, Trust issues, Far East Dominance and the examples can go over and over
and over. One thing to note is that, most of the above-mentioned challenges are man-made but
through a collective effort and strategic (long) term thinking, a lot of the above challenges can be
fixed.
The fact file for industrial operations in Africa from the year 2010 indicate significant business
improvement in the continent. It established that Strategic Industrial sourcing is improving in
selected countries such as Mauritania, Rwanda, Seychelles and South Africa. Intra-African trade
rose from $67.7 BILLION in 2011 to $73.7 BILLION in 2012 which is 11.5% of Africa’s total
trade. Also, Regional wide medium to long term growth prospects are strong and Non commodity-
based trade between African countries is growing BUT at a relatively slower pace. African growth
output remains strong boosted by commodity exports BUT economic development is still
relatively low. Industrialization and economic diversification is firmly on the agenda. Generally,
industrial growth, enterprise and SME developmental efforts are improving but can be
significantly accelerated through collective efforts.
Furthermore, economic facts further indicate that, less than 50% of Government procurement
spend directly goes to African owned and based organizations. Africa is generally supporting long
term job and wealth creation in other regions of the world. Resource-based raw and semi-processed
goods accounted for about 80% of African export products In 2011, compared with 60% In Brazil,
40% In India and 14% In China in the year 2018. In essence, Africa’s GDP does not reflect the
real economic development picture. 72% of the continents young people live on less than 2 dollars
a day. Nearly 50% of Africans live in extreme poverty. Medium to long term growth is subject to
commodity prices remaining high, increasing domestic demand, infrastructural development. Intra
African trade is still relatively low, Comparatively Africans buy more from outside the continent
than any other region. Consumers just buy and not STRATEGICALLY SOURCE! From all the
above facts, it is possible that Industrial and consumer buying patterns in Africa are just helping

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with medium to long term job creation, enterprise growth and supplier development outside the
continent.
As concerns procurement and supply chain management, Africa is relatively not harnessing the
collective value chain resources at her disposal. It may be true to say that, African businesses
generally just “buy” and not strategically source. It is generally no different when it comes to
individuals. In addition to raw material exports, Africa is also exporting “MONEY” through
individual buying habits and EVEN SKILLED HUMAN CAPITAL! Whilst the rest of the World
is STRATEGICALLY SOURCING from Africa to meet MEDIUM TO LONG TERM
developmental needs, Majority of African countries and companies are BUYING from outside the
continent and the rest of the World to meet SHORT TO MEDIUM TERM NEEDS.
OVER 50 YEARS since independence Intra-African trade is still less than 25% of the continent’s
estimated total GDP. This brings to question what Africans are leaving for the future generation.
Can we play a role is reversing this trend? The answer is a big Yes!! One way is THROUGH
STRATEGIC SOURCING.
1.3.2 What is Sourcing?
Being different from buying products, sourcing in its simplest sense, is the process of finding the
appropriate suppliers of goods or services to satisfy a certain want. The key word in the definition
is “the process of finding” i.e research. In this regard, it is the process of putting all the options or
product alternatives on the table and making the most appropriate choice. Many experts in sourcing
say the process is incomplete when your option is limited to just a few numbers of suppliers or
products. But caution must be taken, because when the alternatives become cumbersome, the
process of sorting the best becomes very complex, expensive and time consuming. Therefore, you
must learn, every manager in charge of sourcing must learn how to strike a balance. Sourcing is
not a single act. There is a chain of tasks that are done with the final outcome being the
procurement, in other words the act of purchasing the product or service. Sourcing in essence is a
part of the supply chain of any company. Also, sourcing should have a goal of keeping the costs
of the supply chain as low as possible as the end consumer price has about up to 80% of its cost in
the price of the product.
Even in the most basic form of sourcing there are many approaches that can be used. What is meant
by approaches is where the idea or need for the sourcing comes from. It may be from the R&D
department, marketing department, customer feedback, or is it just simply following trends and
bringing novelty products to a certain market. The need for the product or service is established
then the real work begins. The sourcing official must be willing to research as sourcing, in the
most basic form is about research and the subsequent actions based on the research. The circle of
the supply chain of simple sourcing is illustrated in Figure 1.

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Figure 1.1: The supply chain circle for simple sourcing
From figure 1 above, the process begins with research. This is the process of finding out the
necessity for a product or service. In this process of research, the nature of the product, its price,
its quality, its quantity, its proximity as well as guaranty and many more is inquired. When all the
research has been done and all the alternatives set before organization, then the organization can
make the decision to select the best possible alternative. After this selection process is
accomplished, the next stage is called purchasing. The reality in practice is not as smooth as you
read it now.
Managers and sourcing experts need to keep in mind that, the process of sourcing is a rigorous
process and should therefore be meticulously done with sufficient time for an effective and
efficient work to be done. It is pointless to source a product or service for a company if it cannot
be used or cannot be sold. The process of sourcing products or services or resources is done,
bearing in mind that any product or service should be a solution to a problem. This is where the
risk comes in, and why it is so important to do the research and consider it part of the souring
process.
Now that the need for sourcing has been established, the other activities associated with the process
itself will be explained. They will include procurement phase, standard determination,
specification development, supplier research and selection, value analysis, financing, price
negotiation, making the purchase, logistics and the final consumer.
1.3.3 Procurement
Now that the definition of sourcing is established in its basic form, let’s break down the process
of procurement. The procurement process is the process of buying the product or service taking
into consideration other mechanisms in the sourcing process.

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Procurement can and usually includes the following: Purchase planning, standards determination,
specifications development, supplier research and selection, value analysis, financing, price
negotiation, making the purchase (business dictionary 2016).
The procurement process can also be seen following figure 1.2 below
Figure 1.2 Process of Procurement
As have already been determined procurement is the heart of the sourcing process and should
consume the majority of the time used during the implementation of the sourcing process.
Arguably the most important part of sourcing is actually buying products. Just like anything to
start, there is need for a plan. A good plan is half of a successful project and will generally include,
creating purchasing projects, providing information related to the project, setting task priorities,
start/finish dates, setting reminders, control and evaluation (Business Dictionary 2016.)
1.3.4 Standards determination
Determination of what market or customer base is going to be targeted will determine the standards
of the product or service. Standards may include, but aren’t limited to quality, material,
environmental, governmental, etc.
Specific government agencies in different countries are commissioned with the task of setting the
standards in conformity with the International Standardization Organization (ISO). In Cameroon
we have the ANOR while the Nigerians have the NAFDAC, which are local independent
organization responsible for setting and determining standards of goods and services in their
respective countries.

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1.3.5 Specifications development
After the standards have been established it is a simple task to assign specifications to the product
or service needed. Specifications can be for example, size or color, material tolerances, material
grades, region of origin, etc.
1.3.6 Supplier research and selection
The standards development process will guide the buyer into the supplier research and selection
process. It is a matter of either using existing networks or doing the foot work, but the product
supply is crucial. If a product is not possible to source, which is common, then the process must
start over and have revisions done to the specification’s development. The sourcing team must
keep revising the specifications until the product is possible to procure. In this part of the process
past experience and product knowledge are determining factors in successful product
manufacturing.
1.3.7 Value analysis
The systematic assessment by an organization of every detail of a product to make sure that its
cost is no greater than should be to carry out its desired effect is called product value analysis. In
other words, it is a system to create or help create product value
1.3.8 Financing
Available and ready finances speak volume in the performance of the operations of an
organization. Be it a nonprofit making institution or a profit-making organization, all run
successfully on the wheels of money. At times the best idea may remain a concept and never
materializes due to the absence of capital. Capital to a business could be compared to the
significance of blood to humans.
If there is no money, no product can be purchased. A good business organization has its own
financing structure in place for projects. This is where strategy in sourcing becomes important.
Usually financing is in place before the project begins, either through a company’s financial
department or the sourcing organizations annual budget.
1.3.9 Price Negotiation
For inexperienced people, price negotiation is probably the most frightening aspect of the whole
sourcing process. However, with a good knowledge of the product or service, knowledge of the
culture and negotiation tactics used, knowing what authority the negotiator has (on both sides of
the negotiation), and a good plan, negotiations should go smoothly. In the negotiation process, a
principle is also kept in mind. Never negotiate out of fear or never negotiate out of sympathy. In
negotiation the parties have no friends and have no enemies but they have permanent interest.
There should be emphasis on planning ahead of time for the negotiation and all authority should
be given to the negotiator. Especially the authority to decline completely. In this case the process
goes back to the supplier research and selection.

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1.3.10 Making the Purchase
Arguably the easiest part of the procurement process is making the purchase. But it is not that
simple as the lay man puts it or understands because closing the deal is a great deal. However, it
is in essence the conclusion of the procurement process. The difficult issue on making the purchase
is when either the sourcing organization or the buyer becomes too comfortable with the supplier.
This is where a company sets itself up for losses due to sourcing and where strategic sourcing
becomes more important.
1.3.11 Logistics
Logistics is the planning, control and execution of the procurement. Logistics takes over after the
product has been purchased. This includes moving the product from the supplier’s facilities to the
buyer’s facilities. In this case the buyer is the company not a person. The goal is to allocate the
right resources at the right time to achieve the most cost-effective way of getting the product to
the end customer from the supplier.
To understand logistics in sourcing is a little complex and it can help the company set or break the
target price point for the product. The official responsible for sourcing must understand the
logistics chain and be pro-active in the process. There are many factors in the logistics chain that
constitute costs on the product. These could be, but are not limited to, your logistics agent cost,
raw material cost (fuel), port of origin, region of origin, destination, delays, labor strikes, etc. These
factors should be taken into consideration as the decision to purchase and pay for the product has
already been made. The logistics chain can be broken down, especially for international logistics
as seen in figure 1.3 below.
Figure 1.3: The Logistics chain

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a. Raw Material
All products start from somewhere, and no product fall from the sky. To have a good plan and
conduct a good negotiation, the purchaser or company should have a good understanding of raw
material, quality, prices and trends. These can have a huge impact on the final price and can change
on a daily basis depending on the product. A good example of a product that is usually fixed to
raw material prices is plastic products and oil prices.
b. Suppliers Supplier, and Supplier
It is important to know the origin of the raw materials and different components used in the end
product. A lot of time the supplier will outsource some of the production to a different company.
In the western world it is very important to know where the products are made and under what
conditions are, they made. This will ensure strict quality control and will help out later in the
logistics chain. The supplier is key to the logistics equation. They should and will produce a
product for any customer according to the rules of their contracts. It is important during the
negotiation to talk about the logistics chain and set ground rules or agreements. For example,
product testing is an indispensable rule in the logistics chain process. Having the products tested
according to standards set in the destination country or the end users’ region, prevent the product
from being rejected or considered as contraband. Also being able to prove that they produce
products according to the ethical or moral rules of the purchasing company is very significant for
the customers of the purchasing company. The customers have the ability suspend purchase of the
final product if the raw materials used in production do not meet certain ethical and moral
specifications. This is usually done when the consumers have a very strong buyer’s power, usually
creating a union like a consumer union. For example, customers of super markets in Europe and
America refused to buy vegetable oil (red oil) or products made from the vegetable oil coming
from Asia. The reason was because, the vegetable oil was produced without any attention paid to
environmental rules and standards.
It is also important to establish at what point ownership of the product will change from supplier
to any other party and under what circumstances. If this is not well specified, the parties involved
may be negligent at a certain time over the product assuming that ownership has transferred from
the supplier to the client whereas the client may be assuming that ownership is still under the
control of the supplier. An example is the case between a pharmaceutical company and the
Cameroon Baptist Convention (C.B.C) health complex. A particular medication was sent from
Europe by the supplier company with specifications for it to be stored under a minimum
temperature 20
C. It was successfully transported as such but when it got the Douala International
airport, the airport authority without any knowledge on the product specification, took the product
and kept under normal atmospheric temperature for over 2 weeks. Who will be blamed for the
damage caused? The Supplier Company or C.B.C? The case is still in court and there seems to be
no way forward because no one accepts responsibly for the destruction. An easy way to determine
this is through the internationally recognized Incoterms. Incoterms can be easily understood as
explained below.

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Incoterms (overview)
The Incoterms or International Commercial Terms or trade terms are a series of pre-defined
commercial terms published by the International Chamber of Commerce (ICC) relating to
international commercial law. The Incoterms 2010 rules are standard sets of trading terms and
conditions designed to assist traders when goods are sold and transported. Each Incoterms rule
specifies:
➢ The obligations of each party (e.g. who is responsible for services such as transport; import
and export clearance etc)
➢ The point in the journey where risk transfers from the seller to the buyer.
This chapter is limited to explaining the notion of suppliers’ supplier. However, it is important for
the students to understand what these terms mean and when they should be used. A detailed
explanation of this is brought in chapter 3.
c. Product and Sourcing organization
Once the product is determined and bought, it must be moved to the owner and the physical place
of the sourcing organization. This is where a sourcing organization has options of either owning
their own warehouse or sales facility, or working as an agent or distributer and using other facilities
to keep the product before the end user.
d. End Customer
The end customer is arguably the most important part of any business. However, once the product
is in the end customer’s ownership the sourcing chain starts over. The only reason sourcing
organizations are interested in the end customer is to get feedback on the products or services to
improve their next procurement chain. The end customer is the main focus of the marketing
department. That being said the marketing and sourcing departments should work hand in glove
to develop products or services that suit their business plan and target consumers.
1.4 Key Account Management
Key account management (KAM) is one of the most important changes in the business domain
that has emerged during the past two decades. KAM is a radically different organizational
approach used by businesses today to manage their relationships with strategically-important
customers, who could be considered here as suppliers and it produces tremendous benefits. It
modifies the way we look at the traditional customer relationship management process through the
notion of a key account team (the set of the company resources used for the management of a key
account customer) as compared to the notion of a key account manager (an individual running the
management of a key account customer for the company). Key account management is a strategic
choice for the company. The key account is “created” by the company to be managed in a specific
way. Managing in a specific way here means a different form and approach of customer
management other than the ordinary way of responding to customers’ feedback. More specifically,
this means the creation of a new mission (thus the creation of a new job and new practices) and its
integration into the existing structure of the company. This mission involves coordinating

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corporate information and actions in time and space in relation to a customer in its entirety
(geographical and historical). It should be recalled that for every business there are customers and
among customers, there are customers. This group if well identified and manage is a critical
success factor for the enterprise. They are called high valued customers.
In this subsection, we are interested in the relationship between key account managers and the
company’s internal resources. By resources we mean individuals with different functions and
different hierarchical positions who have a part to play in the management of a key account
customer. Shapiro et Moriarty, (1984b) suggest the term “support-systems” to designate these
resources.
We will show that the key account manager and the support systems together form an account
team as we shall consider it to be : 1) The account team is a new team: the account team offers
something which is not necessarily available elsewhere within the firm; 2) The account team is
transversal: the account team brings together individuals from diverse (organizational) origins; 3)
the account team is hierarchical: there is a formal hierarchical link between the key account
manager and the support systems; 4) the account team is plastic: if the key account manager
considers himself to have access to internal resources (the different support systems), similarly the
support systems also consider the key account manager as a resource for them; 5) the account team
is a team of information: basically, the account team begins to make sense for its members -and
subsequently its observers because at a given moment the members are in a position to share the
same information concerning a key account customer.
1.4.1 Definition of Key Account
As a phenomenon which saw the light of day in the sixties in the United States (Boles, Johnston
and Gardner) key account management has only really appeared in European firms in the last ten
years. The term key account management designates a number of corporate activities implemented
for the specific management of exchanges with some of the organization’s most valued customers.
These customers, which are managed in a specific way, are the key accounts. The most visible
element of key account management is the creation of a new function within the firm: the key
account manager.
Classically, the description given to key account management refers to Barrett’s definition (1986)
quoted as such “National Account Marketing simply means targeting the largest and most
important customers by providing them with special treatment in the areas of marketing,
administration and service […] through one key person (National Account Manager-NAM) or
team headed by the NAM” (Barrett, 1986, page 64).
The term coordination refers to the organization of the different elements of a complex body or
activity so as to enable them to work together effectively. It is the process of organizing people or
groups so that they work together properly and well. It therefore describes the act of arranging,
putting things in order, or making things run smoothly together. Within the business environment,
coordination is the unification, integration, synchronization of the efforts of group members so as
to provide unity of action in the pursuit of common goals of the firm. It is a hidden force which

14. 14
binds all the other functions of management. According to Mooney and Reelay, “Coordination is
orderly arrangement of group efforts to provide unity of action in the pursuit of common goals”.
This therefore means that it is the integration of several parts (in this case functional departments
and their staff) into an orderly hole to achieve a well-defined objective.
1.4.2 The Coordination of Key Account Teams
In this section of our work, we will look closely at the exchanges that the key account manager
has, with the different resources. Recall that, by the term resources we mean individuals with
different functions and different hierarchical positions who have a part to play in the management
of a key account. As noted earlier, Shapiro and Moriarty, (1984b) suggest the term “support
systems” to refer to these resources. These intra-team exchanges (between the key account
manager and the support systems) is very essential for the effective and efficient performance as
well the sustainability of strategic corporate clientele.
It is the responsibility of the key account manager to effectively coordinate the activities of his/her
team on behalf and in good faith for the firm. In this regard, his duty is not far from that of another
departmental head. Generally, as a top management staff, he seeks to achieve coordination in his
team through the basic functions of planning, organizing, staffing, directing and controlling. That
is why, key account manager is not a separate official from management because the achievement
of harmony between individuals’ efforts is directly triggers effort towards the achievement of
group goals. Coordination is the essence of the key account manager role and is implicit and
inherent in all the activities of the team.
As a top corporate executive, the key account manager can be compared to an orchestra conductor
since both of them have to create rhythm and unity in the activities of group members.
Coordination is an integral element or ingredient of all the activities within the team just as a
managerial function as discussed below: -
Coordination through Planning - Planning facilitates coordination by integrating the various plans
through mutual discussion, exchange of ideas. e.g. coordination between finance budget and
purchases budget within the team.
Coordination through Organizing - Shapiro and Moriarty, (1984b) consider coordination as the
very essence of organizing. In fact, when a manager groups and assigns various activities to
subordinates, coordination uppermost is in his mind.
Coordination through Staffing – This refers to task of the key account manager bringing in the
qualified personnel in various positions with right type of education and skills which will ensure
right men on the right job.
Coordination through Directing - The purpose of giving orders, instructions & guidance to the
subordinates is served only when there is a harmony between superiors & subordinates.
Co-ordination through Controlling – Key account Manager ensures that there should be
coordination between actual performance & standard performance to achieve team’s goals.
From the above discussion, we can very much affirm that coordination is the very much essence
in the management of key account teams. It is required in each & every function and at each and

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every stage and therefore it cannot be ignored. The coordination within the team is complex in
reality and no one best way is available to describe it. However, for the sake of this work a simple
approach is presented as seen below for a better understanding.
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principles, theories, and practice”. UK: Prentice Hall.
Dubois, A. and Pedersen, A. (2001) “Why partners do not fit into purchasing portfolio models”,
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Elliott-Shircore, T. I. and Steele, P. T. (1985) “Procurement Positioning Overview”, Purchasing
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Gadde, L. and Håkansson, H. (2010) “Supply Network Strategies”, 2nd ed., UK – Chichester:
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