Thursday, August 13, 2009

Applicability of SAM

Does Supplier Agreement Management (SAM) apply to the supplier? Suppose you're an organization that is supplying to another organization , for example to develop a software package. This organization is not using suppliers. I assume that SAM is not applicable to this organization. Is my assumption correct?

Your assumption is correct. But allow me to restate your scenario to avoid any confusion by using the word organization mulitple times in one sentence. Organization A develops a software package and delivers it to Organization B. Organization A does not use any suppliers or outsource any work. In this case Organization B is the acquiring organization and Organization A is the supplier organization. Therefore, SAM would apply to Organization B, but not to Organization A.


Anonymous said...

Could you please eloborate the points in introductory notes in SAM PA, "SAM primarily addresses the acquisition of products and product components that are delivered to the project's customer. To minimize risks to the project, SAM can also address the aquisition of significant products and product components not delivered to the project's customer but used to develop and maintain the product or service (for example, development tools and test environments)"

Henry Schneider said...

What the introductory notes mean is that an organization would use the Supplier Agreement Management (SAM) practices when they have outsourced the development of a product or service to a supplier or vendor. The acquiring organization provides a set of requirements to the supplier organization for the product or service. The supplier organization is on contract to develop and deliver the product or service, and is therefore responsible for the project management of the product or service. The acquiring organization, depending on the terms and conditions of the agreement or contract, provides oversight and review of the supplier organization at specific points.

These acquirer - supplier interaction practices are critical when the acquired product or service is a component of what the acquirer delivers to its customer. In addition these practices are also useful for important internal uses.

What is not covered by SAM is the situation where the acquiring organization needs more people and they do not want to hire them and instead augment their staff with contractors.