🎯 Welcome to the Sourcing Simulation
You are about to step into the shoes of a procurement professional preparing for a real-world sourcing event. Your task is to analyze the current situation for a specific category within a company and produce a clear, structured overview that will form the foundation for the sourcing strategy that follows.
This step—“Assessing the Current Situation”—is critical. Without a deep understanding of how things currently work, what’s being spent, what’s working (and what’s not), your team risks repeating past mistakes or missing out on opportunities for value creation.
Each group will work with a different sourcing case. These cases represent various industries and procurement categories but follow the same general structure. Your goal is to transform fragmented information into procurement intelligence.
This case is part of the course Sourcing process 2a at Learn How to Source.
📚 Learning Objectives
By completing this activity, you will:
- Practice how to collect and structure procurement-relevant data
- Understand key drivers of value, cost, and risk in different categories
- Identify improvement opportunities that lead to sourcing success
- Prepare sourcing input that aligns with business needs
🧩 Your Role
You are a procurement analyst or category buyer. Your sourcing team will soon decide how to move forward with a new tender or supplier selection. But first—you need to build a fact-based, strategic overview of the current status.
✅ Checklist – What You Must Deliver
Your group will produce a Current Situation Analysis Report that includes the following:
| ✔️ | Task | Description |
|---|---|---|
| 🔍 | Current Spend Overview | Identify annual spend by sub-category or type of product/service. Include trends or spend leakage if mentioned. |
| 📄 | Current Contracts Summary | Outline existing agreements, durations, pricing structures, terms, and any known performance issues. |
| 📦 | Current Specifications Review | Describe what is currently being sourced (technical, service-level, sustainability aspects). Note gaps or outdated specs. |
| ⚠️ | Risks and Challenges | List pain points, risks, inefficiencies, or user complaints in the current setup. |
| 🚀 | Ideas for Improvement & Bold Moves | Suggest improvements, new models, or bold changes that could drive more value, sustainability, or innovation. |
| 🗂️ | Executive Summary and conclusions | Summarize your key findings and recommendation headlines in one slide or paragraph. |
🧠 Tips for Success
- Think like a consultant: What would a decision-maker need to know to support a change?
- Connect the dots between spend, contracts, risks, and business goals
- Keep it professional: organize your analysis clearly, visually if possible
- Use procurement language: frame your findings in terms of value, risk, compliance, performance
📤 Submission
Your team will present your findings either as:
- A short presentation (3–5 slides), or
- A one-page report with key insights per checklist item
Your analysis will be used as a starting point for Step 3: Sourcing Tactics, so clarity and completeness are key!
Find 8 variants of the Step 2 case.
Table of Contents
CASE 1: Office Furniture
Background: The procurement department at “NordicTech Solutions” is preparing for a sourcing event related to the company’s office furniture. This includes desks, chairs, meeting tables, and ergonomic accessories used across its five regional offices in Scandinavia. The last major sourcing event for this category was conducted five years ago, and the contract is now nearing expiration.
The company is undergoing rapid growth, with two new office sites planned to open within the next 12 months. The management wants to ensure that any new sourcing activity supports their sustainability goals and improves flexibility in delivery and installation services.
1. Current Spend
- Total annual spend on office furniture last year: €1.2 million
- Current spend distribution:
- Chairs: €400,000
- Desks: €300,000
- Meeting tables: €250,000
- Accessories (monitor arms, footrests, etc.): €250,000
- There have been some uncontrolled purchases outside the existing agreement (estimated at 15% of total spend).
2. Current Contract(s)
- Current supplier: ErgoFurn AB (Sweden)
- Contract type: 3-year frame agreement with optional 2-year extension (currently in final extension year)
- Terms include standard 5% discount on list prices, delivery within 3 weeks, installation optional (at extra cost)
- Some service complaints: delays in rural area deliveries and lack of after-sales support
3. Current Specifications
- Standardized models defined for 3 chair types, 2 desk models, and 1 meeting table type
- Sustainability requirements were vague in the previous contract
- Some users have asked for height-adjustable desks and greener materials
4. Current Risks and Challenges
- Rising freight and raw material costs
- Supply chain disruptions (last year, 3-month delay in getting chairs for a new office)
- Risk of continued maverick spending and poor user satisfaction
- Current supplier may not scale with future growth
5. Ideas for Improvement & Bold Moves
- Consider new ergonomic standards and diversity in workstation setups
- Introduce circular furniture (e.g., refurbished or recyclable models)
- Integrate digital ordering platform to reduce rogue purchases
- Collaborate with HR to tailor solutions that promote employee well-being
- Consider splitting the contract regionally or by category to increase flexibility and reduce risk
CASE 2: IT Hardware Procurement
Background:
GreenPeak Energy, a renewable energy provider, is preparing to source laptops, monitors, docking stations, and peripherals for their growing workforce. Their remote-work policy increased hardware needs by 30% in the last two years.
Student Assignment:
1. Current Spend
- Annual spend: €900,000
- Laptops: €500,000
- Monitors: €200,000
- Docking stations: €100,000
- Accessories: €100,000
- Increasing ad-hoc orders from different departments
2. Current Contracts
- Supplier: TechOne Distribution
- 2-year contract, expires in 4 months
- Limited bulk discounts, no dedicated service level agreement
3. Current Specifications
- Standard model laptop for most roles, not aligned with high-performance needs of design teams
- No environmental certifications for current hardware
4. Risks & Challenges
- Delays in global chip supply
- Poor device tracking post-purchase
- Security concerns with unmanaged purchases
5. Improvement Ideas
- Standardize models for different user groups
- Introduce leasing model or as-a-service
- Include green criteria (e.g., TCO Certified devices)
CASE 3: Marketing Services Procurement
Background:
FashionFix, an e-commerce clothing retailer, outsources creative campaign work to marketing agencies. With growing digital presence, they’re considering centralizing this spend.
1. Current Spend
- Annual spend: €1.5 million across 6 different agencies
2. Current Contracts
- Mostly project-based, no master agreement
- Lack of consistent terms or price structure
3. Current Specifications
- Scope varies greatly per project; no common briefing structure
- Low visibility on performance metrics
4. Risks & Challenges
- Difficult to compare value across agencies
- Brand inconsistency
5. Improvement Ideas
- Create an approved panel of agencies
- Develop KPIs and creative benchmarks
- Consolidate spend for better rates
CASE 4: Facility Cleaning Services
Background:
AstraMed Pharmaceuticals wants to revisit its cleaning service contracts across its European facilities, aiming to increase hygiene standards and cost-efficiency.
1. Current Spend
- €2.2 million annually across 8 locations
2. Current Contracts
- One supplier per site; varying contract lengths and terms
3. Current Specifications
- No uniform standards for frequency, eco-friendly products, or deep cleaning
4. Risks & Challenges
- High infection-control risk in labs
- Limited supplier oversight
5. Improvement Ideas
- Create a unified cleaning standard
- Bundle locations into fewer contracts
- Include digital tools for cleanliness audits
CASE 5: Temporary Staffing Services
Background:
TechBridge, a software company, heavily relies on temporary IT consultants to manage client projects. Procurement is evaluating how to optimize spend and reduce administrative overhead.
1. Current Spend
- €3 million annually
2. Current Contracts
- 12 different staffing firms; no consolidated agreement
- Hourly rates vary by up to 25%
3. Current Specifications
- Job role templates are outdated
- Few service level expectations
4. Risks & Challenges
- Time-consuming onboarding
- Contractor turnover affecting project delivery
5. Improvement Ideas
- Create a preferred supplier list
- Standardize role descriptions and rates
- Explore MSP (Managed Service Provider) models
CASE 6: Corporate Travel Services
Background:
NordFinance, a multinational financial group, is aiming to reassess their travel services for hotel, air, and rail bookings as part of a cost-control initiative.
1. Current Spend
- €4.5 million/year pre-pandemic; now ~€2.8 million
2. Current Contracts
- Legacy contract with a single travel agency, signed 6 years ago
3. Current Specifications
- No clear sustainability policy
- Limited data reporting features
4. Risks & Challenges
- Employees bypass the travel tool
- Missed savings due to unmanaged bookings
5. Improvement Ideas
- Reintroduce policy-compliant booking platform
- Negotiate direct hotel and airline deals
- Introduce carbon offset tracking
CASE 7: Industrial Packaging Supplies
Background:
ShipCo Logistics is reviewing their sourcing of industrial packaging—pallets, stretch film, crates, and strapping—for their European warehouses.
1. Current Spend
- €1.8 million/year
2. Current Contracts
- Regional suppliers with different pricing and delivery conditions
3. Current Specifications
- Many custom packaging specs, limiting flexibility
4. Risks & Challenges
- High waste volume
- Difficulty tracking usage across sites
5. Improvement Ideas
- Consolidate to fewer packaging standards
- Introduce returnable packaging options
- Leverage scale for better pricing
CASE 8: Catering & Vending Services
Background:
The municipal government of Västlund is sourcing catering and vending services for 10 public buildings including schools and administrative offices.
1. Current Spend
- €950,000 annually
2. Current Contracts
- 3 catering companies and 2 vending suppliers
3. Current Specifications
- No common menu guidelines or allergen policies
- Few healthy or sustainable options
4. Risks & Challenges
- Public scrutiny on food quality
- Compliance issues with dietary regulations
5. Improvement Ideas
- Centralized food safety and nutrition policy
- Introduce digital ordering or meal tracking
- Prioritize local and seasonal ingredients
Assessing the Current Situation: A Key Sourcing Step for Trainee Buyers
Introduction
When beginning any sourcing project, step 2, a crucial task is assessing the current situation. This step is about taking a thorough look at where your organization stands today before you pursue new supplier arrangements. For a buyer-in-training, developing the skill of assessing the current situation will build a strong foundation for successful sourcing. In practice, this means gathering facts and data about current spend, suppliers, contracts, and performance, and making sure all stakeholders share a common understanding of these facts. This guide will walk you through how to perform this step in a structured way. We’ll use examples from IT hardware, office furniture, staffing services, and marketing services to show how assessing the current situation applies across industries.
What Does “Assessing the Current Situation” Entail?
In a sourcing context, assessing the current situation means conducting a detailed internal analysis of the organization’s current procurement setup for the category in question. You examine your existing procurement practices, supplier relationships, contract terms, service levels, and performance metrics . Essentially, you’re creating a baseline picture of how things are done now. This analysis helps identify areas for improvement and sets the foundation for the rest of the sourcing process
For example, if you’re sourcing IT hardware, this step would entail reviewing all current hardware suppliers, the volumes and types of equipment purchased, prices paid, support agreements, and any issues the IT department has encountered. By assessing the current situation, you gather the information needed to decide where to focus in the sourcing initiative.
Importantly, assessing the current situation is typically the second step in a strategic sourcing process – coming right after forming your team and project plan. In fact, creating a good procurement strategy involves first determining business needs and assessing the current situation before setting objectives and crafting a plan ca.indeed.com. Skipping this step would be like trying to map a route without knowing your starting point. Whether you call it a current state analysis, spend analysis, or opportunity assessment, the goal is the same: to fully understand your internal environment before engaging the supplier market.
Why is Assessing the Current Situation Important?
Spending time on this assessment brings several benefits. First, it uncovers baseline data against which you can measure improvement. For instance, you might discover that the company spent $5 million on office furniture last year across 10 different vendors. That baseline helps set targets (e.g. reduce spend by 10% or consolidate vendors) and measure the success of your sourcing project later. Second, it helps identify pain points and opportunities early. Maybe stakeholder feedback reveals that employees find the current office chairs uncomfortable, or that marketing feels their agency rates are too high.
These insights highlight what criteria will matter most in the upcoming sourcing (better ergonomics, or cost savings, respectively). Third, it ensures alignment – by assessing the current situation together, the team and stakeholders develop a shared understanding of the facts. This shared understanding ensures consistency in the team’s approach and enhances collaboration going forward. Overall, this step de-risks the project: you won’t be blindsided later by internal problems you failed to consider. It sets you up to devise a sourcing strategy that truly fits your organization’s needs and starting conditions.
Key Data and Information to Gather
A thorough assessing the current situation exercise is data-driven. As a buyer-in-training, you should learn to collect and analyze various types of information. Common data and documents gathered during this phase include:
- Spend Reports – Quantify the current spend in the category. How much did you spend last year on this product or service? Break it down by supplier, internal department, or region if applicable. For example, in an IT hardware case, compile the total spend on laptops, servers, etc., by each supplier. By breaking down current spend and pricing models, you can often spot opportunities to reduce costs or find savings us.caddi.com. This spend analysis may reveal, say, that one business unit is paying higher prices for the same laptops, indicating a savings opportunity through standardization.
- Current Contracts – Gather all existing supplier contracts or agreements for the category. Note key details like contract duration and expiry dates, pricing terms, service level agreements (SLAs), and any clauses that might affect a new sourcing (e.g. renewal notice periods). In a staffing services example, you might find you have contracts with three staffing agencies, each with different mark-up rates and end dates. Knowing your contract landscape prevents unwittingly overlapping or terminating needed agreements and helps schedule the sourcing project at the right time (for instance, ahead of a major contract expiring).
- Product/Service Specifications and Requirements – Compile the specifications or scope of work that the company currently uses. What are you buying, in detail? For products, this could be technical specs, part numbers, or standards. For services, it could be descriptions of services, frequencies, and KPIs. In an office furniture scenario, document the standard furniture models or materials currently in use (e.g. chair models, desk types) and any current requirements (like ergonomic standards or fire safety certifications). This ensures that when you go to market, you know what needs to be met or if requirements should be updated.
- Supplier Performance Data – Review how current suppliers are performing. This might include quality metrics (defect rates, returns), delivery metrics (on-time delivery rate, lead times), and service metrics (response time on support, etc.). For example, if you’re assessing a marketing services category, you might look at campaign outcomes from the current marketing agency, adherence to timelines, and feedback from the marketing team on the agency’s creativity and service. Any performance issues or, conversely, strengths should be noted as part of the current situation analysis. They will influence what you prioritize in the new sourcing (e.g. if quality is an issue, quality improvements become a key goal).
- Stakeholder Feedback and Requirements – Engage the internal stakeholders who use or rely on the goods/services in question. Their insights are invaluable. Conduct interviews, surveys, or meetings to learn what is working well and what isn’t. Ask stakeholders like end-users, department heads, or requesters about their satisfaction with current suppliers and any unmet needs. In an IT hardware example, the IT support team might report that certain laptop models break frequently, or employees might desire lighter laptops or newer features. In a staffing example, hiring managers might share feedback on the responsiveness or candidate quality from current staffing agencies. This qualitative feedback provides context beyond the numbers, highlighting issues such as service quality or user preferences that data alone might not show.
- Risks and Challenges – Identify any risks in the current state. Are you overly dependent on a single supplier? Are there compliance or regulatory issues? Any recurring problems or potential disruptions? For instance, perhaps one supplier provides 80% of your office furniture and they’ve had financial troubles – that’s a supply risk to note. Or in marketing, maybe your current agency contract has an auto-renew clause that could lock you in if not addressed. Understanding these risks as part of assessing the current situation allows you to proactively plan to mitigate them in your sourcing strategy.
- Improvement Ideas (“Bold Moves”) – As you compile the data and listen to stakeholder input, start capturing any ideas for improvement. These could range from obvious fixes (e.g. consolidating suppliers, standardizing specifications, renegotiating rates) to more ambitious changes (e.g. switching from buying hardware outright to a leasing model, or bringing a service in-house). At this stage, you’re not deciding on solutions yet, but noting possible directions. This creativity ensures the assessment isn’t just a passive reporting of the status quo, but a springboard to the next step. For example, during an assessing the current situation review for IT hardware, the team might realize that moving to a single standard laptop model company-wide could simplify support and get volume discounts – an idea to explore in the strategy phase.
By gathering all the above information, you create a comprehensive picture of “where we are now.” It can be helpful to compile these findings into a brief report or presentation for your team. That report might include spend charts, a list of current suppliers and contracts, performance scorecards, and summary of stakeholder comments.
Involving a Cross-Functional Team
Assessing the current situation should not be a solo effort by procurement. Involving a cross-functional team is critical. This team typically includes stakeholders from various departments that are involved with or affected by the category. For example, if the project is sourcing office furniture, include someone from Facilities or Corporate Services (who manages the office setup), end-user representatives (employees who use the furniture), and Finance (for spend data and budget insights), in addition to the buyer/procurement person.
In an IT hardware project, the team would include IT department staff, and for a marketing services project, marketing department members would be key. Engaging a cross-functional team means you’ll have the best people assembled to handle issues and concerns that can affect the entire organization vendorful.com. Each member brings unique expertise and perspectives: IT can speak to technical requirements, Finance can validate spend figures, and end-users can voice practical needs.
Working as a team to assess the current state has multiple advantages. It ensures no important detail is overlooked – one person might remember to pull the last supplier scorecard, another might have access to a database of contracts, someone else may flag a risk that others weren’t aware of. It also builds buy-in. As stakeholders participate in the assessment, they become more invested in the sourcing process and its outcome vendorful.com. They’ll also gain a deeper understanding of the requirements and constraints beyond their own silo vendorful.com.
For instance, the HR manager in a staffing services sourcing team might learn about budget limits, while the buyer learns about the specific skill gaps that hiring managers face – both parties develop a broader view. Cross-functional collaboration from the start fosters transparency and keeps everyone’s interests in mind, leading to more efficient and innovative solutions vendorful.com. In short, assessing the current situation as a team sets the stage for a smoother sourcing project with stronger internal support.
Achieving a Shared Understanding
One key objective of assessing the current situation is to achieve a shared understanding and agreement on the current state among all team members and stakeholders. After gathering the data and insights, the team should come together to discuss and confirm the findings. This could be done in a workshop or review meeting where the procurement analyst presents the summarized current-state report. During this session, it’s important to validate the facts (e.g., “Is everyone aligned that our total spend with Supplier X was $2M last year?”) and to surface any discrepancies or additional input. The goal is that by the end, the cross-functional team agrees on the key points describing the current situation: how much is spent, with whom, what the performance is, what users think, and so on.
Achieving this shared understanding has significant value. It ensures that the team moves forward with a unified baseline – there won’t be conflicting assumptions about the starting point. This unity will make the next steps (like setting objectives and sourcing strategy) much easier, because everyone is on the same page regarding what needs to change or improve. A shared understanding also ensures consistency in messaging to any higher-ups or other stakeholders.
For example, if a senior executive asks why a sourcing project is being undertaken, the team can uniformly explain the current situation and the rationale (e.g., “We currently have three staffing vendors with inconsistent rates and quality, which we all agree is suboptimal and needs improvement.”). Having the team collectively acknowledge the current state helps in establishing a unified approach, which enhances overall collaboration and efficiency in execution. It can be useful to document the agreed findings and have team members sign off or at least explicitly concur, as this creates accountability and a reference point. Remember, assessing the current situation is only valuable if its insights are understood and accepted by those who will drive the change.
Step-by-Step: How to Assess the Current Situation
Now, let’s break down assessing the current situation into practical steps you can follow:
- Assemble Your Team: Begin by confirming a cross-functional sourcing team (if not already done in a prior step). Ensure representation from key functions (e.g., the IT department for IT hardware, end-users for office furniture, HR for staffing, marketing for marketing services, plus finance and procurement). Communicate the purpose of the exercise to the team: you are collectively assessing the current situation to build the foundation for the sourcing project.
- Gather Internal Data and Documents: Divide and conquer the data collection. The buyer may pull spend reports from the finance system, a finance analyst can provide budget forecasts, an operations or department manager can supply current usage or inventory data, etc. Collect all relevant documents such as current contracts, service level reports, performance scorecards, and policy documents. For example, in a marketing category, gather all current contracts with marketing agencies, including any statements of work and results from recent campaigns, and spend reports from accounting showing how much was paid to each agency.
- Interview Stakeholders: Schedule short interviews or discussions with stakeholders who have insights on the current situation. Use a questionnaire or checklist to guide these conversations. Ask what’s going well, what pain points exist, and what outcomes they desire. In a staffing services case, talk to a few hiring managers about their experience with current staffing suppliers – are they filling roles quickly? Are candidate quality and fit acceptable? Such feedback humanizes the data and may reveal issues like “Supplier A finds great candidates for IT roles but struggles with marketing roles,” which data alone wouldn’t show.
- Analyze and Compile Findings: Take all the raw data you’ve gathered and analyze it. Look for patterns, anomalies, and key points. Calculate important figures (e.g., total annual spend, average pricing per unit or hourly rate, supplier performance ratings). Identify any gaps in information and fill them if possible. It can help to create visual summaries: charts of spend by supplier, tables comparing each supplier’s performance, a timeline of contract expirations, etc. Write a narrative that ties it together: for example, “Currently, we have 3 marketing agencies under contract. Agency X handles digital ads (rated 8/10 performance), Agency Y does print media (6/10 performance), Agency Z handles PR (9/10 performance). Total spend last year was $4.5M, with Agency Y being the most expensive. Stakeholders are generally satisfied except with print media results. Contracts for X and Y expire in 6 months, Z in 12 months. Key risks: lack of backup for PR if Agency Z fails; opportunity: consolidate print and digital with one agency for efficiency.” This kind of analysis captures the essence of the current situation.
- Review with the Team for Consensus: Share the compiled findings with the cross-functional team. Hold a review meeting to walk through the data and analysis. Encourage questions and clarifications. Ensure that each team member sees their input reflected and agrees with the conclusions. This is where you solidify the shared understanding – debate any differences in interpretation and resolve them. If the facilities manager believes the spend figure on office furniture is different, now is the time to resolve why (maybe some purchases were made on a corporate credit card that weren’t in the report, etc.). Through this review, align on the narrative of the current state. The team might update or fine-tune the findings during this step.
- Document the Agreed Current State: Once consensus is achieved, document the final “current situation assessment” in a format that can be referenced throughout the project. This could be a slide deck, a written report, or even a one-page summary for simpler cases. Include the key data points, any charts, and bullet-point summaries of major issues or opportunities identified. It’s helpful to have this document accessible to all team members and to executives who oversee the project. In our IT hardware example, the document would clearly state things like “Current State: 5,000 laptops from 3 suppliers; standard spec is XYZ; Spend $2M/year; Performance: Supplier A meets SLA 95% of time, Supplier B 90%; Issue: no standardized model leading to high support costs; Opportunity: standardize and consolidate suppliers.” With this, anyone coming into the project can quickly grasp where things stand.
- Obtain Stakeholder Buy-In (if needed): In some cases, especially for strategic or high-impact categories, you may want to get formal buy-in on the current situation findings from senior stakeholders or a steering committee. This might involve presenting the assessment to an executive sponsor. The idea is to ensure the organization’s leadership concurs with how the team perceives the current state. Their agreement means you have support (and possibly resources) to proceed to the next steps. For a staffing example, you might brief the HR Director or CFO on the current fragmentation of staffing spend and get their endorsement that “Yes, we see the problem and support moving forward with a sourcing initiative to address it.”
By following these steps, assessing the current situation becomes a clear and manageable process. It transforms what could be a vague starting point (“We need to save money on marketing”) into a concrete understanding (“Here is exactly how we spend on marketing now and where we might save”). This due diligence upfront will guide you in formulating an effective sourcing strategy.
Examples from Different Industries
To cement the concept, let’s look at assessing the current situation in a few different sourcing scenarios:
- IT Hardware Example: A mid-size tech firm plans to source new laptop suppliers. In assessing their current situation, the cross-functional team (procurement, IT support, finance, and a power-user representative) gathered data on all computers in use. They found 5 models of laptops from 3 suppliers, totaling 5,000 units with an annual spend of $2 million. IT support reported that one model has significantly higher failure rates. Contracts revealed two supplier agreements expiring within a year. Stakeholder feedback showed employees are generally satisfied but would prefer lighter ultrabook models. The team reached a shared understanding that the current state is fragmented (multiple models and suppliers) and identified an opportunity to standardize to one or two models for better pricing and support. This baseline set the stage for them to seek a supplier that could meet the standard spec with improved reliability and cost.
- Office Furniture Example: A global corporation is re-sourcing its office furniture. During assessing the current situation, the team (procurement, facilities managers from several offices, an ergonomics specialist, and finance) compiled the spend on furniture: last year $5.5 million across dozens of items (chairs, desks, etc.) from four main suppliers. They catalogued current furniture specifications and learned that different locations had varying standards (height-adjustable desks in some offices, fixed in others). Feedback from employees highlighted that the current chairs were not comfortable for long hours (a potential productivity and health concern). The team also discovered that one supplier was responsible for 60% of the spend and that contract is expiring in 3 months. Everyone agreed the current situation showed inconsistent standards and a heavy reliance on one vendor. This shared understanding drove the team to prioritize ergonomic improvements and supplier diversification in the upcoming sourcing.
- Staffing Services Example: A financial services company wants to streamline its use of temporary staffing agencies. In the assessment phase, the cross-functional team (procurement, HR, hiring managers from key departments, and legal) gathered all invoices and found the company spent $3 million on temps last year through six different agencies. They listed current contract terms – some agencies were under contract, others used on an ad-hoc basis. HR provided data on fill rates and time-to-fill for each agency, and hiring managers shared feedback (e.g., “Agency C sends the best candidates for finance roles, Agency D struggled with IT roles”). They also noted compliance requirements (background checks, etc.) currently handled differently by each supplier. The team identified that the current state had overlapping supplier roles and inconsistent performance. By achieving consensus on these findings, the team felt confident in targeting two or three preferred agencies through the sourcing process, aiming for better consistency and perhaps volume discounts, since they understood exactly where the pain points and spends were concentrated.
- Marketing Services Example: A retail company is reviewing its marketing and advertising suppliers. Assessing the current situation involved the marketing department, procurement, and finance. They listed all current marketing-related suppliers: one creative advertising agency, one digital marketing firm, and several freelance designers. Spend analysis showed $4 million per year in total, with the creative agency taking the largest share. Performance metrics (like campaign ROI and brand recognition scores) were reviewed for each. Stakeholder feedback from the marketing team praised the creative agency’s design work but noted slow turnaround times, and flagged that the digital firm’s results on social media campaigns were underwhelming. Contracts were month-to-month with freelancers and annual with the agencies. The team highlighted as risks the lack of a long-term contract with the star creative agency (risk of them parting ways) and the mediocre results in digital marketing. Through discussion, the cross-functional team achieved a shared view that the current marketing procurement was fragmented and possibly costing more for less impact. This understanding led them to consider consolidating all needs with either an integrated agency or at least set clearer performance targets in new contracts. The assessing the current situation phase thus directly informed their strategy to improve marketing ROI.
Each of these examples shows how assessing the current situation provides actionable insights. In all cases – whether tangible goods like hardware and furniture or services like staffing and marketing – the team that thoroughly understood their starting point was able to chart a smarter course forward.
Conclusion
For students training to become buyers, mastering assessing the current situation is an essential competency. It might seem like a lot of groundwork, but this structured internal review is what empowers a buyer to make informed decisions later. By defining what you have and what you need to fix, you build confidence in tackling the sourcing project. Always remember to be systematic: work with a team, gather data diligently, and ensure everyone agrees on the findings.
A well-executed current situation assessment not only uncovers improvement opportunities, but also unites the team with a clear vision of the challenge ahead. Professional buyers know that a shared, data-backed understanding of the status quo is the launching pad for sourcing success. As you practice assessing the current situation in various sourcing projects, you’ll become faster and more adept at it – and your cross-functional colleagues will come to appreciate this step as the moment when complexity is clarified. With this foundation in place, you are ready to move confidently into defining strategies and engaging the supplier market, armed with the knowledge of exactly where your organization currently stands.