Every organization makes decisions about functions that will be completed in-house versus via a third party. Those decisions are made based on core competencies, resource availability and the like. The problem is that once made these decisions are rarely revisited. Today, there is an explosion in outsourcing opportunities. New providers are opening for business on a daily basis. Functions that were not feasible to outsource yesterday are attractive today. It is equally true that companies are looking to expand their offerings, sometimes this warrants bring an outsourced function back in-house.

Purchasing’s role in this area is to raise the question - "Have we correctly sourced each function." Purchasing must team with the rest of the organization to answer this question. The value add of purchasing is twofold. First, to provide a structured process for evaluating outsource opportunities. Second, to identify potential suppliers and negotiate the deal. This negotiation is especially important because outsourcing is hard and often costly to undo.

An excellent discussion of "Right Souricng" is provided by Norbridge (www.norbridgeinc.com)