Specification Assessment In Procurement Strategies: Change Nature Demand D8-Kearney
R&D and engineering departments are continually learning as material prices change, substitute materials emerge, experience in production or use provides new insights or creates new issues, and production processes stabilize and create a clearer understanding of acceptable or necessary tolerances. Concurrently, a growing product line expands the material requirements and expands the complexity of specifications even within common material families. During product development, compromises are sometimes made under time pressure even though, on closer inspection, better solutions would have been possible. In short, framework conditions change. So it makes sense to subject originally justified specifications within and across product requirements to a critical review and analysis from time to time. Specifications that are no longer necessary can be revised and adjusted in line with current needs or to reflect new commercial options.
One important factor in this analysis process is complete openness toward every specification change. The assessment has typically been conducted in a workshop-like process that includes engineers, production experts, financial controllers, purchasers, and suppliers. This means all relevant parties can consider all aspects of a change in specifications, and decisions can be made with no unnecessary delays. The analysis should begin by focusing on underlying customer requirements since current specifications represent the original solution for meeting a need. The workshop approach is still valid, but it has been enhanced with the advent of using expressive bidding techniques to collect market-driven specification alternatives. With all stakeholders present and armed with the most up-to-date commercial information and established technical data, the workshop approach facilitates fast decision making with greater alignment on the alternatives for specification changes. The discussion process asks whether these requirements could also be met by modifying specifications—for example, by using another material, a different thickness, or new tolerances, especially in light of changing framework conditions or new information about the market. The main focus of the analysis will naturally be on the specifications that are most responsible for driving costs and which of those might be reconsidered. However, smaller changes can also create considerable cost savings, especially if they are easy to implement. After the workshop, an evaluation of savings is carried out, and a business case is produced.