How can buyers apply the RAQSCI model to effectively identify their business needs?
In order to achieve value for money in every purchase, buyers must comprehensively define what their company needs. Failure to identify these needs can expose the company to risks such as obsolescence and financial losses. According to CIPS study guides, buyers are encouraged to use the RAQSCI framework to define all aspects related to their purchased items. RAQSCI stands for Regulation, Assurance of Supply, Quality, Service, Cost, and Innovation.
Regulation
This refers to laws, standards, or regulations that a purchased item must comply with. If buyers overlook this factor, their company may face various risks such as product recalls, production disruptions, reputational damage, and loss of sales. Buyers should clearly specify legal compliance requirements when communicating with suppliers.
Assurance of Supply
Ensuring that suppliers can deliver goods or services reliably is crucial. Any delay can disrupt production and result in lost customer orders. Key factors to consider include:
- Supplier capacity: The supplier’s ability to meet demand in terms of volume and timing.
- Production volume: Can the supplier meet the required quantity?
- Scalability: Can they increase production to meet urgent needs?
- Lead time: How quickly can they fulfil and deliver orders?
- Resource availability: Do they have sufficient labour, equipment, and facilities?
- Technology and infrastructure: Are their systems modern and efficient?
- Geographic location: Can they deliver within the required timeframe, especially over long distances?
- Financial capability: The supplier’s financial stability to support operations and fulfil orders.
- Supply risk management: How effectively the supplier handles potential risks to ensure continuity.
Buyers should specify requirements related to supplier capacity, financial health, and risk management to ensure timely fulfilment of needs.
Quality: This encompasses key product attributes that suppliers must meet:
- Performance: Does the product fulfil its intended function?
- Reliability: Can it operate without defects?
- Durability: Does it meet longevity expectations?
- Conformance: Does it meet specified standards?
- Efficiency: Does it operate without wasting resources?
- Safety: Is it safe for users and the environment?
- Aesthetics: Is it visually appealing?
By defining these aspects, buyers can create detailed product specifications. Vague terms like “premium quality” may lead to unmet expectations.
Service
This refers to the supplier’s ability to support the buyer when issues arise. It includes responsiveness to requests, assistance with product usage, and training programs. Buyers should clearly outline the types of services they expect from suppliers.
Cost
This includes the total cost incurred over the product’s lifecycle. While many buyers focus solely on cost, neglecting other factors can result in products that are unfit for purpose. Buyers can use target costing, whole-life costing, or pricing benchmarks to determine acceptable costs. They should also define preferred payment methods that support their company’s cash flow.
Innovation
Does the supplier have a process for innovation to enhance customer experience? Is there a continuous improvement program in place? Suppliers who innovate may offer better products or lower prices in the future, benefiting the buying organization. Buyers should not disregard the requirement for supplier innovation, as it can support their competitive position in the market.
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