Purchasing Chessboard (PowerPoint PPT Slide Deck)

PROCUREMENT STRATEGY PPT DESCRIPTION

Editor Summary The Purchasing Chessboard is a 24-slide PowerPoint procurement strategy framework developed by A.T. Read more Kearney and provided by LearnPPT Consulting, outlining 4 purchasing strategies and a five-step implementation approach. The deck maps 16 levers to 64 methods for supplier cost reduction and value creation, and includes templates, spend-analysis guidance, and workshop agendas. Target users include procurement executives, supply chain professionals, business consultants, and cross-functional teams. Sold as a digital download on Flevy with immediate digital download.

Use this framework when procurement must adapt to changing supply and demand conditions—such as volatile markets, supplier consolidation, or strategic cost-reduction initiatives.

  Procurement executives designing sourcing strategies using the 16 levers and 64 methods to decide between competition, collaboration, demand change, or spend management.
  Supply chain managers conducting spend analysis and supplier tiering to prioritize categories and apply appropriate tactics.
  Business consultants running strategy workshops to teach the 4 strategies and apply templates in client engagements.
  Cross-functional teams mapping category placement and updating strategies via the five-step implementation process.

The approach’s explicit market-condition mapping and structured five-step implementation reflect A.T. Kearney’s project-based procurement methodology.

Read Marcus Overview

Explore Slides inside the Deck:

Five-Step Process for Purchasing Chessboard Implementation Framework for Strategic Procurement Optimization Integrating Strategies, Levers, and Methods in Procurement

The procurement strategies at many organizations lack the flexibility to adapt to radical changes occurring today. Gone are the days when organizations could have managed supply markets using relatively simple tools and techniques—e.g. RFIs, RFPs, bundled products and services, and multi-year contracts etc. Markets, nowadays, are disparate and expect vastly different methods to operate.

To endure the procurement challenges of this age, the Purchasing Chessboard is a broad framework, developed by A.T. Kearney, to address almost any supply and demand market condition. The Purchasing Chessboard is a compilation of insights and experience from thousands of purchasing projects performed worldwide.

This slide deck provides a detailed description of the 4 purchasing strategies under the Purchasing Chessboard and a high-level view of the framework’s implementation. The 4 critical purchasing strategies include:

1. Leverage competition among suppliers
2. Seek joint advantage with suppliers
3. Change the nature of demand
4. Manage spend

Within the Purchasing Chessboard framework, we further break down the 4 purchasing strategies into 16 levers and further into 64 methods. All the 64 standalone methods in the Purchasing Chessboard present a unique differentiating tactic to work with suppliers to reduce costs and increase value. Each method maps to a specific lever, which maps to a specific strategy.

The presentation deck also includes some slide templates for you to use in your own business presentations.

This comprehensive presentation also delves into the practical implementation of the Purchasing Chessboard, offering a 5-step approach to effectively categorize and apply strategies. It emphasizes the importance of cross-functional team involvement and continuous strategy adjustment to align with market dynamics. The PPT includes detailed templates to facilitate your own procurement strategy development and execution, ensuring you have the tools needed to drive cost reduction and value creation in your supply chain operations.

MARCUS OVERVIEW

This synopsis was written by Marcus [?] based on the analysis of the full 24-slide presentation.

Executive Summary
The Purchasing Chessboard is a comprehensive procurement strategy framework designed to navigate diverse supply and demand market conditions. Developed by A.T. Kearney, this presentation outlines 4 critical purchasing strategies: leveraging competition among suppliers, seeking joint advantages with suppliers, changing the nature of demand, and managing spend. The framework comprises 16 levers and 64 methods, providing actionable insights for procurement professionals to enhance cost efficiency and supplier value. This deck serves as a valuable resource for organizations aiming to adapt their procurement strategies to today’s complex market dynamics.

Who This Is For and When to Use
•  Procurement executives and managers seeking to optimize sourcing strategies
•  Supply chain professionals aiming to enhance supplier relationships
•  Business consultants focused on procurement strategy development
•  Cross-functional teams involved in procurement decision-making

Best-fit moments to use this deck:
•  During the development of procurement strategies in response to market changes
•  When assessing supplier performance and value creation opportunities
•  In workshops aimed at training procurement teams on advanced strategies
•  For strategic planning sessions focused on cost reduction and supplier collaboration

Learning Objectives
•  Define the 4 purchasing strategies within the Purchasing Chessboard framework
•  Identify and apply the 16 levers that drive procurement strategies
•  Utilize the 64 methods to enhance supplier value and reduce costs
•  Develop a tailored procurement strategy based on specific market conditions
•  Implement a structured approach to managing spend and supplier relationships
•  Foster collaboration between procurement and other business functions

Table of Contents
•  Overview (page 3)
•  Purchasing Levers & Methods (page 6)
•  Purchasing Chessboard Strategies (page 10)
•  Purchasing Chessboard Implementation (page 15)
•  Templates (page 22)

Primary Topics Covered
•  Purchasing Strategies - The framework outlines 4 key strategies: leverage competition among suppliers, seek joint advantages with suppliers, change the nature of demand, and manage spend.
•  Levers and Methods - The Purchasing Chessboard includes 16 levers and 64 methods that provide actionable tactics for procurement professionals.
•  Market Adaptability - The framework emphasizes the need for procurement strategies to be adaptable to varying market conditions and supplier dynamics.
•  Implementation Steps - A structured five-step approach is provided for effectively applying the Purchasing Chessboard in organizations.
•  Templates - The presentation includes templates for practical application of the strategies and methods discussed.

Deliverables, Templates, and Tools
•  Framework for assessing supplier competition and collaboration
•  Templates for implementing purchasing strategies and methods
•  Guidelines for conducting spend analysis and supplier assessments
•  Tools for managing procurement categories and strategies
•  Resources for training procurement teams on the Purchasing Chessboard framework

Slide Highlights
•  Overview of the Purchasing Chessboard framework and its significance in modern procurement
•  Detailed breakdown of the 4 purchasing strategies and their associated levers
•  Visual representation of the 16 levers and 64 methods within the framework
•  Step-by-step guide for implementing the Purchasing Chessboard in organizations
•  Templates for practical application of the strategies discussed

Potential Workshop Agenda
Introduction to the Purchasing Chessboard (30 minutes)
•  Overview of the framework and its relevance
•  Discussion on current procurement challenges

Leveraging Competition Among Suppliers (60 minutes)
•  Explore methods for enhancing supplier competition
•  Case studies on successful implementation

Collaborative Strategies with Suppliers (60 minutes)
•  Identify joint advantage opportunities
•  Workshop on developing strategic partnerships

Managing Spend Effectively (60 minutes)
•  Techniques for spend analysis and management
•  Action planning for immediate implementation

Customization Guidance
•  Adjust the framework to reflect specific market conditions and supplier dynamics
•  Tailor the levers and methods to align with organizational goals and procurement capabilities
•  Incorporate company-specific terminology and metrics in templates and presentations
•  Update implementation steps based on team competencies and resource availability

Secondary Topics Covered
•  Supplier tiering and its impact on procurement strategy
•  The role of data mining in procurement decision-making
•  Sustainability considerations in supplier partnerships
•  Risk management strategies in procurement

Topic FAQ

What are the main purchasing strategies managers use to respond to market changes?

Procurement frameworks commonly differentiate between competing approaches: leverage supplier competition, seek joint advantages with suppliers, change the nature of demand, and manage spend. The Purchasing Chessboard explicitly organizes actions into these 4 strategies to guide tactic selection across categories and suppliers, covering 4 strategies.

How do “levers” and “methods” function in strategic sourcing frameworks?

In such frameworks, levers are tactic categories that shape strategy choice while methods are concrete actions applied under each lever. The Purchasing Chessboard breaks strategy into 16 levers and further into 64 distinct methods, helping teams map tactical options to strategic intent with 16 levers and 64 methods.

What practical steps should teams follow to implement a new procurement strategy?

A structured implementation typically includes categorizing spend, applying chosen strategies, reviewing competencies, involving cross-functional teams, and updating strategies based on feedback. The Purchasing Chessboard recommends a five-step implementation process that emphasizes category placement and ongoing adjustment, summarized as a 5-step process.

What should I look for when selecting a procurement toolkit for strategic sourcing projects?

Evaluate whether a toolkit maps strategies to tactics, provides templates for spend analysis and supplier assessment, supports workshop/training use, and describes an implementation sequence. The Purchasing Chessboard includes templates, spend-analysis guidance, and a five-step implementation, making those useful selection criteria.

How can spend analysis be used to inform procurement strategy choices?

Spend analysis identifies high-cost categories, concentration, and supplier dependencies to prioritize levers and methods. Effective frameworks provide templates and guidelines to convert spend insights into strategy—Flevy’s Purchasing Chessboard includes spend-analysis guidance and templates for this purpose.

What role does supplier tiering play when applying procurement strategies?

Supplier tiering helps determine which suppliers merit competition, collaboration, or other tactics by ranking importance and performance. Tiering informs allocation of methods to suppliers; the Purchasing Chessboard and its templates address supplier tiering and assessment within strategy selection.

After a merger, which procurement approach helps integrate disparate supplier bases?

Post-merger teams should map market conditions for each category, then apply appropriate strategies—drive competition where overlapping supply exists, pursue joint advantages for strategic suppliers, change demand where consolidation is possible, and manage spend to capture synergies. The Purchasing Chessboard frames these choices across its 4 strategies.

What value do prebuilt procurement templates and workshop agendas deliver compared to building tools from scratch?

Prebuilt templates accelerate diagnostics, standardize spend analysis, and provide ready exercises for training procurement teams, shortening time-to-action. The Purchasing Chessboard supplies templates, workshop agendas, and implementation guidance to help teams apply strategies faster and consistently.

Document FAQ
These are questions addressed within this presentation.

What is the Purchasing Chessboard?
The Purchasing Chessboard is a procurement strategy framework that provides organizations with tools to navigate diverse supply and demand market conditions through 4 key strategies and various methods.

How can this framework help my organization?
It allows organizations to adapt their procurement strategies to changing market dynamics, enhancing supplier relationships and reducing costs.

What are the 4 purchasing strategies?
The 4 strategies are: leverage competition among suppliers, seek joint advantages with suppliers, change the nature of demand, and manage spend.

What are the 16 levers?
The 16 levers are specific tactics that drive the 4 purchasing strategies, providing actionable methods for procurement professionals.

How do I implement the Purchasing Chessboard?
The framework can be implemented through a structured five-step process that involves placing categories, applying strategies, reviewing competencies, involving cross-functional teams, and updating strategies regularly.

Can this framework be customized?
Yes, organizations can tailor the framework to reflect their specific market conditions, procurement capabilities, and strategic goals.

What types of templates are included in the presentation?
The presentation includes templates for assessing supplier performance, managing procurement categories, and implementing purchasing strategies.

Is training available for using the Purchasing Chessboard?
Yes, workshops and training sessions can be conducted to familiarize teams with the framework and its application in real-world scenarios.

Glossary
•  Purchasing Chessboard - A framework for developing procurement strategies based on market conditions.
•  Levers - Specific tactics that drive purchasing strategies.
•  Methods - Actionable techniques for enhancing supplier value and reducing costs.
•  Supplier Tiering - Categorizing suppliers based on their importance and performance.
•  Spend Analysis - The process of analyzing spending patterns to identify cost-saving opportunities.
•  Risk Management - Strategies to identify and mitigate risks in procurement.
•  Sustainability Management - Incorporating sustainable practices in supplier relationships.
•  Data Mining - Analyzing data to inform procurement decisions.
•  Joint Advantage - Collaborative strategies that benefit both buyers and suppliers.
•  Market Conditions - The current state of supply and demand affecting procurement strategies.
•  Implementation Steps - A structured approach for applying the Purchasing Chessboard framework.
•  Templates - Pre-designed resources for practical application of strategies and methods.
•  Cross-Functional Teams - Teams composed of members from different departments working together on procurement strategies.
•  Value Chain Management - Coordinating activities across the supply chain to optimize value.
•  Cost Reduction - Strategies aimed at lowering procurement costs.
•  Procurement Outsourcing - Engaging third parties to manage procurement activities.
•  Collaborative Partnerships - Long-term relationships between buyers and suppliers aimed at mutual benefit.
•  Total Cost of Ownership - The comprehensive cost of acquiring and using a product or service over its lifecycle.
•  Compliance Management - Ensuring procurement practices adhere to regulations and standards.
•  Vendor Managed Inventory - A system where suppliers manage inventory levels for buyers.

PROCUREMENT STRATEGY PPT SLIDES

Five-Step Process for Purchasing Chessboard Implementation

This PPT slide outlines a five-step implementation process for the Purchasing Chessboard, a strategic tool for enhancing purchasing effectiveness. The first step involves identifying and defining relevant purchasing categories, establishing focus areas. The second step applies tailored purchasing strategies to these categories, aligning actions with organizational goals. The third step reviews the competencies of the purchasing function, assessing current capabilities and identifying gaps for effective category management. The fourth step emphasizes involving cross-functional team members to leverage diverse expertise for informed decision-making. Finally, the process requires updating categories on the Purchasing Chessboard and adjusting strategies, ensuring relevance and effectiveness in a changing environment. This structured approach provides a roadmap for optimizing purchasing strategies.

Framework for Strategic Procurement Optimization

The Purchasing Chessboard framework enhances procurement strategies through 16 levers derived from 4 core strategies: "Change nature of demand," "Manage spend," "Seek joint advantage with supplier," and "Leverage competition among suppliers." Under "Manage spend," levers like "Innovation breakthrough," "Risk management," and "Demand management" optimize expenditure and resource allocation. "Seek joint advantage with supplier" focuses on collaboration, featuring levers such as "Value chain management" and "Cost partnership" to foster partnerships that improve efficiencies and cost savings. "Leverage competition among suppliers" drives down costs with levers like "Tendering" and "Supplier pricing review," emphasizing competitive bidding and regular pricing assessments. This structured approach aids procurement professionals in navigating complex purchasing decisions, highlighting strategic thinking and collaboration for operational efficiencies.

Integrating Strategies, Levers, and Methods in Procurement

The Purchasing Chessboard framework integrates 3 layers: strategies, levers, and methods. The top layer outlines 4 primary purchasing strategies: changing demand, managing spend, seeking joint advantages with suppliers, and leveraging supplier competition. The second layer features 16 levers that operationalize these strategies, such as innovation breakthrough and risk management under managing spend. The third layer presents 64 methods for executing these levers, including cost analysis and compliance management for risk management, and volume bundling for demand management. This hierarchical structure illustrates the interconnection between strategies, levers, and methods, enabling procurement teams to refine strategies and enhance operational efficiency.

Strategic Framework for Buyer-Supplier Collaboration

The "Purchasing Chessboard" framework addresses buyer-supplier dynamics when both parties possess equal market power, emphasizing that equal power alone does not guarantee sustainable cost or value benefits. The goal is to cultivate collaborative partnerships that enhance the value chain through joint management and integrated operations planning. Key procurement levers include Value Chain Management, Value Chain Partnership, Integrated Operations Planning, and Cost Partnership. Specific methods like Value Chain Reconfiguration, Supplier Tiering, Profit Sharing, and Strategic Alliance are highlighted to drive efficiency in supplier relationships. These frameworks facilitate alignment of operational strategies and cost structures, fostering synergy and innovation for cost optimization and shared benefits, ultimately leading to long-term strategic alliances.

Framework for Effective Spend Management Strategies

This PPT slide presents a framework for Smart Spend Management within strategic procurement, particularly beneficial in low-demand, low-supply markets like maintenance, repair, and operations. It leverages 4 key procurement levers: Co-sourcing, Demand Management, Commercial Data Mining, and Volume Bundling. Co-sourcing enhances sourcing effectiveness through collaboration, while Demand Management controls demand via compliance and contract management. Commercial Data Mining extracts insights from procurement data, and Volume Bundling consolidates purchases for better pricing. The slide outlines 16 methods under these levers, including Compliance Management and Supplier Consolidation, emphasizing data-driven approaches like Cost Data Mining and Spend Transparency to optimize procurement strategies and reduce costs while increasing value.

Strategic Framework for Optimizing Procurement Methods

The Purchasing Chessboard framework outlines 64 methods to enhance procurement strategies, categorized by their effectiveness in reducing costs and increasing value. The vertical axis represents supply power (low to high), while the horizontal axis indicates demand power (low to high). Methods like "Invent on demand" and "Leverage innovation network" are positioned at the high supply and demand power intersection, emphasizing proactive sourcing through innovation and supplier collaboration. In contrast, "Demand reduction" and "Contract management" focus on traditional, reactive strategies in lower grid sections. These methods can be applied individually or in combination, allowing organizations to tailor procurement strategies to specific market conditions and supplier relationships. The Purchasing Chessboard serves as a guide for optimizing procurement processes, enabling significant cost savings and enhanced supplier collaboration.

Source: Best Practices in Procurement, Strategic Sourcing, Sourcing Strategy PowerPoint Slides: Purchasing Chessboard PowerPoint (PPT) Presentation Slide Deck, LearnPPT Consulting