I gave a speech yesterday to a group of sixty procurement, supply chain, and operations executives at a conference put on by the American Gas Association here in Chicago. They gave me 30 minutes to talk about best practices in supply chain and spend management in the 21st century (talk about discussing a boil the ocean subject in about the time it used to take my Mercedes 240D to accelerate to 60 MPH). The main gist of my talk was that all procurement organizations -- just to maintain parity with their competitors -- should invest in the following areas today: basic visibility and analysis, eProcurement, strategic sourcing / eRFX, and contract management. But advanced organizations -- those that will truly become the best practice Spend Management organizations of the future -- are already tackling such areas as advanced spend visibility and analysis, global sourcing and supply management, supply risk management, and supply performance management. It was definitely a Spend Management 101 talk, but hopefully it chugged along like my old diesel once did, and did not put the audience to sleep.
Before the presentation, I had a chance to sit down with George Gordon who serves as President and CEO of Enporion, a provider of procurement and sourcing technology and services to the energy industry (and others markets in the future, according to George). What got my attention from our discussion were not their current solutions which are probably most differentiated on breadth, low-cost and reliability, rather than innovation relative to other vendors. Instead, what is must unique about Enporion is how in new product development initiatives they're taking an incredibly focused category approach to generating Spend Management value in niche markets. For a good part of our discussion, George told me about his Spend Management "vegetation" solution. Sounds odd, I know, but it turns out that one of the largest spend categories for utilities is tree-trimming services. Enporion has developed an application that will help utility and tree trimming providers to model when trees in specific areas need to be trimmed based on various inputs such as type, rainfall, soil, proximity to power lines, etc. The plan is to help utilities cut their tree trimming spend by 15% or more. Fascinating and focused. Not a bad combination.