Throughout our careers, each one of us will be asked to find creative ways to reduce costs or otherwise transform our operations. These questions don’t always come at opportune times, and it can be very difficult to balance the needs of the corporate entity with our own human emotions.
In December 2011, I faced this question, not for the first time. To keep up with the changing marketplace, we need to reimagine our business operations. Traditional sourcing was certainly a part of the model, but we questioned what would happen if we broke away from the traditional mold.
Could we find unique opportunities to meet the demands of our business, while also giving back to the community?
We found our answer in the world of Impact Sourcing.
Impact sourcing is the intersection of the needs of a corporate entity with the desire for each of us to give back to our communities. It is the trifecta of creating innovative sourcing alternatives, producing tangible business benefits and helping organizations achieve their Corporate Social Responsibility (CSR) objectives.
At its core, impact sourcing is the act of engaging with high potential, yet disadvantaged people across the globe. It is the business practice of prioritizing suppliers who provide learning and career development opportunities to those who have otherwise limited prospects for long-term sustainable employment.
The term “outsourcing” has been around for decades. Outsourcing is generally used to describe any work that a corporate entity does not deem core to its operations and therefore engages a third party to perform on its behalf. While they are not synonymous, outsourcing and offshoring are often used together when describing the practice of engaging in a third-party relationship.
Impact sourcing is a relatively new twist on the traditional outsourcing model and can be delivered from many onshore and offshore locations. Impact sourcing is about investing in people, the quality of work produced and meeting clients exactly where their business needs are.
The tangible business benefits of impact sourcing are vast and continue to grow as the industry takes note of this new sourcing model. While cost is certainly a critical milestone, a cost-only mentality to any sourcing strategy is short-sighted.
Impact sourcing offers sourcing leaders an opportunity to meet their cost objectives while building a workforce that is committed to growth and scale (Liberty Source, 2019). Through engaging with an Impact Sourcing firm, you will build relationships to power your business for the long-term versus achieving a one-time and short-lived cost-reduction exercise.
Sourcing leaders are starting to recognize that their sourcing strategy is best served as an extension of their hiring strategy. Hiring managers look for people who are engaging, hold similar values, are innovative and who can take the organization to the next level. A compelling sourcing strategy should follow the same path.
Business Benefits of Impact Sourcing
Through partnering with an impact sourcing firm, you are affirming that people are an important element to the success of your business and that you will not compromise on quality, while also maintaining the cost structure necessary to ensure you remain competitive in the marketplace.
Through unique learning and engaging employment opportunities, impact sourcing firms enjoy the natural advantage of having a highly engaged workforce. This workforce is proud of the work they are producing and they are emotionally vested in the organization they work for as well as their clients.
Impact sourcing is not philanthropy. The Rockefeller Foundation, whose mission is to promote the well-being of humanity throughout the world, sees impact sourcing as a critical path to global well-being. They describe impact sourcing as “an inclusive employment practice through which companies intentionally connect high-potential, disadvantaged demographics and provide job training along with opportunities for higher education. It is not all about social benefits: impact sourcing has proven benefits to the buyer.”
While some see impact sourcing only as an opportunity to lift-third world nations out of poverty, The Rockefeller Foundation sees the opportunity here in the U.S. as well. For many Americans, the education they need to hold a professional career is out of reach. For others, the opportunities for career advancement are not available due to where they live or other personal situations.
As sourcing executives, we are all well-positioned to advance the strategic initiatives of our organizations as well as support the development of underserved populations here in the U.S. and abroad.
If not well-planned, and if implemented without a long-term vision, your sourcing strategy will fall flat on its face. You may achieve a cost target, but you will have failed to create the relationship and scalability needed to succeed over the long term.
If your sourcing strategy is a blend of cost, quality, achieving long-term objectives and building a reliable workforce for the future, impact sourcing may be the right alternative for you.