The Purchasing Chessboard®: Reduced cost, increased value

The Purchasing Chessboard® is a tool for developing sourcing strategies based on the relative bargaining power.


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AT Kearney developed the concept of The Purchasing Chessboard® in the mid 2000s. The main idea of the chessboard is to demonstrate the link between sourcing strategies and specific situations which might confront businesses, particularly illustrated by the relative bargaining power between buyers (power derived from their demand) and suppliers (power derived from their position in the supply market).

Study of these concepts and power balances led AT Kearney to develop a structured and practical three tier model based on the idea of a chessboard. The model is based on three levels, with 4 basic strategies on level one, 16 so called levers on level two and finally 64 sourcing methods on level three.


A common challenge faced by sourcing buyers is the development of effective sourcing approaches which are appropriate to the circumstances faced by their companies or organisations. Over time consultants and academics have designed many approaches to help address the issue and each have their favourite sourcing model. However as Supply vs. Demand challenges become more complex it has become increasingly obvious that there is no “one size fits all” approach. Commodities differ in their characteristics, for example their relative importance to organisations, their supply markets, the relative buyer and supplier power and so on. A simplified approach such as the 7 step sourcing process becomes less helpful as complexities increase and something more structured and comprehensive is required.

The concept of The Purchasing Chessboard® is based on the idea that an examination of the distribution of bargaining power between buyers and suppliers is crucial for developing effective sourcing strategies.

The advantage of the chessboard is that it provides detailed and practical guidance in three areas:

1. Sourcing buyers Buyers are guided on how to determine the balance of power between buyers and suppliers for each category in the market.
2. The chessboard can identify suitable and effective sourcing strategies applicable to each market situation and power distribution scenario.
3. The chessboard provides ideas (called chess moves) on how to restructure the supply market to the buyer’s advantage.

An example: Where circumstances are such that all the power lies with the supplier, the question for the buyer is not whether to restructure the supply market but how to do it! Buyers must employ strategies which increase demand power, reduce supply power or ideally both. AT Kearney visualises three approaches to address these problems by referring to a chess game and the following moves:

1. The Bishop move

This move  is a lateral move on the chessboard from the upper-left side to the lower-right hand side of the chessboard

2. The Castle move

This move  is a horizontal move in which the buyer maintains control over its supply while increasing its influence over demand

3. The Queen

This move  is a combination of the two other moves over a certain time period.

This video will help you in understanding how “playing chess” can lead to really powerful and robust sourcing strategies.


Faculty name: Holger Schober
Duration: 24:00 Min.
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