Managing the input market: the strategic challenge

The intended contribution of a purchasing function, is to effectively, and efficiently, manage an input market. It might be argued, therefore, that the purchaser’s primary strategic contribution is necessarily limited to the manipulation and exploitation of his or her firm’s input market, with the express intent of significantly improving the firm’s output market competitiveness. Output market competitive strategy is underpinned by the inherent need to seek an advantageous and sustainable difference between a firm and its competitors. Purchasers, however, are seldom mandated to challenge the orthodoxy and routine inherent in supplier selection paradigms. This invariably results in the purchaser dismissively selecting important suppliers that are equally available to competitors. In other words, the orthodoxy contained within purchasing convention, and accepted practice, is unlikely to result in the differences from which a sustainable (input market derived) competitive advantage can be achieved. This paper seeks to address this apparent impasse. It does so by considering a variety of concepts and ideas, including; the competence deficit, the competence release agent, the role of subversives, rebels and contrarians, spilt milk, reverse marketing, predatory relationships and input market stretch.