SAQA All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.
SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED UNIT STANDARD: 

Conduct initial assessment for strategic sourcing 
SAQA US ID UNIT STANDARD TITLE
260077  Conduct initial assessment for strategic sourcing 
ORIGINATOR
Task Team - Treasury 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY
-  
FIELD SUBFIELD
Field 03 - Business, Commerce and Management Studies Procurement 
ABET BAND UNIT STANDARD TYPE PRE-2009 NQF LEVEL NQF LEVEL CREDITS
Undefined  Regular  Level 6  Level TBA: Pre-2009 was L6 
REGISTRATION STATUS REGISTRATION START DATE REGISTRATION END DATE SAQA DECISION NUMBER
Reregistered  2018-07-01  2023-06-30  SAQA 06120/18 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2024-06-30   2027-06-30  

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

This unit standard does not replace any other unit standard and is not replaced by any other unit standard. 

PURPOSE OF THE UNIT STANDARD 
This unit standard will enable learners to interpret Strategic Sourcing in the context of Supply Chain Management, analyse a commodity portfolio, understand how organisation objectives can be impacted by the portfolio/commodity under review, draft a strategic priority list and identify the costs and benefits of continuing with the Strategic Sourcing process.

A person credited with this unit standard is able to:
  • Demonstrate an understanding of strategic sourcing within the context of the wider procurement environment, supply chain management and organisational objectives.
  • Conduct a Landscape Assessment.
  • Conduct a cost and benefit analysis.
  • Form and present a business case to assist stakeholder decision-making.

    This unit standard will contribute to the development of the learner within the context of supply chain management. Learners who have achieved this unit standard will increase their opportunities for further development and employability within the supply chain management environment. 

  • LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
    It is assumed that the learner has the following knowledge and skills:
  • Basic principles of supply chain management at NQF Level 5. 

  • UNIT STANDARD RANGE 
    Commodities includes goods, works and services. 

    Specific Outcomes and Assessment Criteria: 

    SPECIFIC OUTCOME 1 
    Demonstrate an understanding of strategic sourcing within the context of the wider procurement environment, supply chain management and organisational objectives. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    The impact of strategic sourcing is qualified and quantified in terms of the value, cost, benefits and nature of the portfolio/commodity under review. 

    ASSESSMENT CRITERION 2 
    Strategic sourcing is evaluated in terms of various applicable supply chain management models indicating the influence that strategic sourcing has on these models. 
    ASSESSMENT CRITERION RANGE 
    Models include but are not limited to:
  • Martin Christopher's supply chain model, Public Sector Supply Chain Management model.
     

  • ASSESSMENT CRITERION 3 
    Ways in which strategic sourcing can assist in the achievement of organisational objectives is investigated and interpreted to determine their impact. 

    ASSESSMENT CRITERION 4 
    Ways in which the portfolio/commodity under review can assist is investigated and interpreted to determine their impact on the achievement of organisational objectives. 

    SPECIFIC OUTCOME 2 
    Conduct a Landscape Assessment. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    A commodity portfolio is analysed to determine the strategic importance thereof. 
    ASSESSMENT CRITERION RANGE 
  • Analysis includes but is not limited to volume, value, commodity segmentation, complexity of market as well as the complexity of commodity.
  • Portfolio refers to a category of commodities.
     

  • ASSESSMENT CRITERION 2 
    Segment the portfolio using Kraljic's model indicating the relative value and risk ascribed to the segments within the commodity portfolio. 
    ASSESSMENT CRITERION RANGE 
    Segments are classified as strategic, leverage, bottleneck and non-critical commodities.
     

    ASSESSMENT CRITERION 3 
    Segmenting the commodities within a portfolio according to inherent organisational requirements. 
    ASSESSMENT CRITERION RANGE 
    Inherent organisational requirements include but are not limited to commonality, technicality, value and service delivery requirements.
     

    ASSESSMENT CRITERION 4 
    Potential strategies are evaluated to determine their applicability depending on the nature/segments of the commodities within a portfolio. 

    ASSESSMENT CRITERION 5 
    A priority list is derived from the analysis based on the strategic importance and potential opportunities within the portfolio. 
    ASSESSMENT CRITERION RANGE 
    A priority list can be based on but is not limited to the potential value of the opportunity or commodity, strategic importance, ease of implementation, time required to implement, inherent risks.
     

    SPECIFIC OUTCOME 3 
    Conduct a cost and benefit analysis. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    Ways in which strategic sourcing can assist with the achievement of organisational objectives are confirmed and utilised to determine the benefits to be achieved. 

    ASSESSMENT CRITERION 2 
    Ways in which the portfolio/commodity under review can assist is confirmed and utilised to impact on the achievement of organisational objectives. 

    ASSESSMENT CRITERION 3 
    The feasibility of conducting strategic sourcing within the portfolio is estimated in order to weigh the benefits against costs and risks. 
    ASSESSMENT CRITERION RANGE 
    Feasibility study includes but is not limited to cost, benefits, savings, resources and future trends.
     

    ASSESSMENT CRITERION 4 
    A plan and timetable are established to determine the resource requirements for conducting strategic sourcing within the portfolio. 
    ASSESSMENT CRITERION RANGE 
  • Resources requirements include but are not limited to physical resources, organizational resources (roles, responsibilities, skills needed, cross functional teams).
  • Plan includes but is not limited to a high level project plan and communication plan.
     

  • SPECIFIC OUTCOME 4 
    Form and present a business case to assist stakeholder decision-making. 
    OUTCOME RANGE 
    Form includes but is not limited to prepare, develop and compile. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    A decision on the feasibility is made based on the results of the cost and benefit analysis. 

    ASSESSMENT CRITERION 2 
    Stakeholders are identified and their respective needs are analysed to determine the impact that strategic sourcing within the portfolio would have on them. 
    ASSESSMENT CRITERION RANGE 
    Analysed include but is not limited to influence of stakeholders, impact of the sourcing strategy on them, stakeholder needs, potential areas of resistance.
     

    ASSESSMENT CRITERION 3 
    A business case is developed to address the identified stakeholder needs. 
    ASSESSMENT CRITERION RANGE 
    Business case includes but is not limited to value proposition, current situation, proposed strategy, cost vs benefit, high level implementation plan, performance measurement criteria.
     

    ASSESSMENT CRITERION 4 
    The developed business case is prepared for presentation in accordance with audience requirements. 

    ASSESSMENT CRITERION 5 
    The business case is presented in accordance with organisational requirements. 


    UNIT STANDARD ACCREDITATION AND MODERATION OPTIONS 
  • The assessment will be governed by the policies and guidelines of the relevant Education and Training Quality Assuror (ETQA) that has jurisdiction over this field of learning.
  • The assessor will (at the very least) be accredited and have a relevant qualification and be a subject matter expert in this learning area and at least have 3 years experience in the skills specific area.
  • The learner can be assessed against this unit standard to obtain credits or as part of an integrated assessment for a qualification:
    > Internal moderation.
    > External moderation.
    > An assessor, accredited by the relevant ETQA, will assess the learner's competency.
    > Assessment procedures will be supplied by the ETQA in alignment with NSB requirements.
    > All assessment activities must be fair, so that all candidates have equal opportunities. Activities must be free of gender, ethnic or other bias.
    > Assessment and moderation procedures, activities and tools must be transparent, affordable and support development within the field, sub-field and NQF.
    > Questions and answers to determine theoretical knowledge are expected.
    > Assessment of a portfolio of evidence.
    > Direct observation in simulated and/or controlled work conditions. 

  • UNIT STANDARD ESSENTIAL EMBEDDED KNOWLEDGE 
    Commodity Categorisation:

    Group the commodity into applicable groups and sub-groups:
  • Spend.
  • Characteristics.
  • Function.
  • Strategic importance.
  • Usage profiles.

    Business Landscape:
  • Understanding of the geographical dispersion of all stakeholders for the commodity group in question.
  • Identify the level of autonomy of the end-user base.
  • Understanding of the organisational structures applicable to this process.

    Supply Chain Processes:

    The supply chain process identification will entail an understanding of the following areas listed below via interviews (with suppliers and relevant end-users) and contract information where relevant:
  • Forecasting/estimating quantity practices and procedures.
  • Procurement/purchasing practices.
  • Distribution and storage practices.
  • Disposal practices.
  • Problems faced by end-user with suppliers/commodities under question and vice versa.
  • Cost drivers and bottlenecks along the value/supply chain for the commodity in question.
  • Manufacturing landscape (imported, fully or semi manufactured locally).

    Current Contracts:

    Obtain copies of current contracts for the commodity group in question. Analyse contract details:
  • Suppliers engaged with the contract.
  • Contract duration.
  • Constraints, e.g. exit clauses.
  • Items/commodity groups specified within the contracts.
  • Volumes and prices specified within the contracts.

    Legislation/Policy:

    Identify legislation or policy that may influence:
  • The organisation's purchasing practices.
  • The commodity groups/sub-groups/items.

    Market Analysis:

    In this context, market analysis includes supplier and industry analysis.

    Examples of the tools and instruments for analysis:

    PEST Analysis: Identifying key influences affecting the industry players, examples may include:

    Political issues:
  • Industry specific legislation regulating the industry.
  • The relationships between organisation and industry.
  • Organisation control/ownership of industry etc.
  • Industry Charters.

    Economic issues:
  • Currency fluctuations, inflation, etc.

    Socio-cultural issues:
  • Social/cultural constraints regarding the commodity/industry.
  • BEE requirements.

    Technological issues:
  • Patents, future trends etc.

    Porter's Five Forces Model:

    Conduct industry analysis:
  • Identify universe of suppliers (threat of new entry, barriers to entry).
  • Understand industry dynamics (competitive rivalry amongst suppliers).
  • Analyse the organisation's purchasing power in the industry (Buyer power).
  • Analyse the bargaining power of the industry (Supplier power).
  • Product /service dynamics (threat of substitution, cost of change).

    Methods to Obtain Information for Porter's Five Force Model:

    Organisation Impact:
  • Interview industry experts, internal buyers, commodity experts, suppliers etc.

    Supplier Complexity:
  • Pricing structures of each supplier.
  • Cost drivers per supplier.
  • Suppliers BEE status and contribution to government goals.

    Consolidate Information:
  • Supply market/industry information obtained.
  • Supply market complexity determination and consolidation when plotting the 'Sourcing Category Positioning Matrix' (Kraljic).
  • Strategy option selection.

    Spend analysis:

    Current and Historical Spend Analysis:
  • Historical and current spend per:
    > Grouping/sub-category.
    > Supplier.
    > User.
    > Time period e.g. Monthly.

    Current and Historical Volume Analysis:
  • Historical and current volume per:
    > Grouping/sub-category.
    > Supplier.
    > User.
    > Time period e.g. Monthly. 

  • UNIT STANDARD DEVELOPMENTAL OUTCOME 
    N/A 

    UNIT STANDARD LINKAGES 
    N/A 


    Critical Cross-field Outcomes (CCFO): 

    UNIT STANDARD CCFO IDENTIFYING 
    Identifying and solving problems in which responses display that responsible decisions using critical and creative thinking have been made when:
  • Analysing data. 

  • UNIT STANDARD CCFO WORKING 
    Working effectively with others as a member of a team, group, organisation, and community during:
  • Participation in a cross-functional sourcing team.
  • Interactions with end users and suppliers at various levels. 

  • UNIT STANDARD CCFO ORGANISING 
    Organising and managing oneself and one's activities responsibly and effectively through:
  • Planning activities.
  • Gathering information and data. 

  • UNIT STANDARD CCFO COLLECTING 
    Collecting, analysing, organising and critically evaluating information during:
  • Developing strategic sourcing plan.
  • Collecting data.
  • Making decisions on options. 

  • UNIT STANDARD CCFO COMMUNICATING 
    Communicating effectively using visual, mathematical and/or language skills in the modes of oral and/or written persuasion when:
  • Developing plans.
  • Engaging with stakeholders.
  • Present business case. 

  • UNIT STANDARD CCFO SCIENCE 
    Using science, technology and indigenous knowledge effectively and critically, showing responsibility towards the environment and health of others through:
  • Gathering information and data.
  • Analysing information and data. 

  • UNIT STANDARD CCFO DEMONSTRATING 
    Demonstrating an understanding of the world as a set of related systems by recognising that problem-solving contexts do not exist in isolation when:
  • Determining best options for specific strategies.
  • The relationship between the sourcing strategy and the relevant policies and legislation. 

  • UNIT STANDARD ASSESSOR CRITERIA 
    N/A 

    REREGISTRATION HISTORY 
    As per the SAQA Board decision/s at that time, this unit standard was Reregistered in 2012; 2015. 

    UNIT STANDARD NOTES 
    N/A 

    QUALIFICATIONS UTILISING THIS UNIT STANDARD: 
      ID QUALIFICATION TITLE PRE-2009 NQF LEVEL NQF LEVEL STATUS END DATE PRIMARY OR DELEGATED QA FUNCTIONARY
    Elective  50060   National Certificate: Public Administration  Level 5  Level TBA: Pre-2009 was L5  Reregistered  2023-06-30  PSETA 
    Elective  74149   National Certificate: Supply Chain Management  Level 5  NQF Level 05  Reregistered  2023-06-30  TETA 
    Elective  67460   National Diploma: Public Administration  Level 6  NQF Level 06  Reregistered  2023-06-30  As per Learning Programmes recorded against this Qual 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS UNIT STANDARD: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    1. Aldabri 106 Institute for Quality Pty Ltd 
    2. BPL Academy 
    3. Brilliant Skills Development & Training Solutions 
    4. Centre for Logistics Excellence (Pty) Ltd 
    5. College of Production Technology 
    6. COMMERCE EDGE SOUTH AFRICA PTY LTD 
    7. Global Maritime Legal Solutions Pty Ltd 
    8. KVR TRAINING AND BUSINESS SOLUTIONS PTY LTD 
    9. Makwedeng Training 
    10. Metro Minds 
    11. Phephani Learnerships cc 
    12. Pro-Active Assessment and RPL College (Pty) Ltd 
    13. School of Shipping 
    14. Skills Development Specialists 
    15. UKWAKHILE TRAINING 
    16. Y2K College 



    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.