For a long time now, procurement has been about much more than just buying. Procurement teams today are immersed in strategic sourcing, supporting a broad range of strategic initiatives from advancing sustainability and digital transformation to enabling academic innovation and supplier diversity. In fact, 79% of procurement teams say they are being asked to support more objectives and initiatives than just a few years ago.
The expectations are high, and it takes a team effort to make it happen. As Nancy Zimpher, Chancellor Emeritus of the State University of New York, explained: “The future of higher education resides in coordination and collaboration.”
To meet these demands, colleges and universities must clearly understand the differences between sourcing and procurement, and how to use both strategically.
Sourcing focuses on identifying, evaluating, and selecting suppliers. It’s a strategic process aimed at building the supply chain your institution needs to succeed.
Key sourcing activities include:
Sourcing answers the question: Who should we work with and why? It’s about building strategic partnerships to meet institutional goals.
Procurement itself makes up the buying process. It’s primarily transactional, generally focusing on making purchases once approved.
Common procurement functions include:
In higher education, finance and procurement teams handle most of the process for both sourcing and procurement with input from key stakeholders.
Key Differences Between Sourcing and Procurement | ||
Feature | Sourcing | Procurement |
Focus | Strategic supplier selection | Transactional purchasing |
Timing | Begins before a purchase | Begins after supplier is selected |
Primary Goal | Long-term value and alignment | Efficiency, compliance, and cost control |
Activities | Supplier discovery, RFPs, negotiation | PO generation, invoicing, contract execution |
Relationships | Builds partnerships | Manages transactions |
Understanding this distinction is important if you want to shift from reactive purchasing to a value-driven procurement sourcing strategy.
A procurement sourcing strategy requires a disciplined and consistent approach. Here are three overarching factors:
Strategic sourcing should reflect your institution’s broader priorities:
Every supplier relationship should advance your mission.
Forming cross-functional teams, including IT, academics, facilities, and finance, ensures that contracts reflect real needs and what your staff and students require. It’s this collaborative approach that reduces risk and boosts adoption.
Data is key to better sourcing decisions. By analyzing historical spend, performance benchmarks, supplier delivery records, and cooperative contract options, you can simply make better procurement decisions.
Strategic sourcing can help suppliers become partners that innovate along with you. For example, when looking at IT solutions, you want to work with suppliers who can customize options that fit your infrastructure and integrate with your existing systems. At the same time, you want scalable solutions that can evolve as your needs change.
When suppliers act as partners, they are more likely to be proactive and identify solutions that are a good fit your needs.
Once a contract is signed, the real work begins. Supplier performance should be tracked and refined throughout the life of the agreement. By actively tracking and managing supplier relationships, you can help make them stronger and drive innovation.
Consider:
Cooperative contracts can play a key role in sourcing and procurement, bridging the gap by offering access to a wide range of suppliers who might otherwise not bid on individual RFPs. These ready-to-use contracts are competitively solicited and can save you time and money.
E&I Cooperative Services aggregates demand from more than 6,000 academic institutions to achieve volume discounts you likely could not get on your own. Because E&I is the only nonprofit, member-owned sourcing cooperative that focuses solely on education, you also get terms and conditions that fit the unique needs of higher education.
Using cooperative contracts enables you to benefit from strategic sourcing without having to start from scratch or give up control or flexibility.
Why spend months on strategic sourcing when the work’s already done? See E&I’s competitively solicited contracts and focus your energy on strategic procurement instead.