Will Social Media Converge With Procurement and Supply Chain Applications? (Part 2)

In the first part of this post, I linked to a column that examined how social media is already starting to transform aspects of HR applications at the core, not at the periphery. I firmly believe that social media and social interaction can transform procurement as well, even though it faces a number of challenges in our neck of the universe relative to HR (the most important to overcome will be the generally less social, less interactive side of procurement and operations types relative to bubbly HR folks). But if we can overcome the initial hurdle of showing the power of social interaction within procurement, I have no doubt that social media capabilities will eventually catch hole permanently, and transform the collaboration capabilities of many of the applications we already work with going forward.

What are use cases for social media and social interaction in procurement? One that is quite clear and valuable is in the area of supplier qualification, discovery, risk and performance management. Rather than simply request periodic qualitative comments and quantitative scorecard metrics, I could see a dynamic application that includes both inter- and intra-enterprise data -- aggregate information in the case of the latter -- that lets users share information and ask questions. For example, a user might post an update such as: "I'm going to supplier XYZ tomorrow for a visit and site audit -- anything to look out for, and questions worth asking that might be out of the ordinary?" which in turn would be posted both internally, to peers, but potentially externally as well, to a private group of colleagues (potentially blinded and aggregated).

Another use case, and one that Spend Matters is very close to formally launching with two partners, is social networking for category sourcing and information sharing. This has been a work in progress for the past two years, but we believe there is tremendous opportunity for peers to directly share information with each other in a private and controlled manner around a range of category areas. We believe this model could potentially eventually be disruptive to existing business models, replacing the types of information that vendors and consultancies traditionally share for a fee as part of engagements with peer-to-peer requests and information exchange.

Even though I'm biased because of what we've done -- and what we're doing -- with Spend Matters, I think social media will eventually become part of the fabric of sourcing, contract management supplier management and even P2P applications (not to mention collaborative forecasting and demand planning toolsets, replacing the shared spreadsheet, among other past tools used in this regard). If anyone else has a use-case or business idea for social media in procurement or the supply chain, please don't hesitate to drop a line. I'm happy to trade thoughts, provide feedback and suggest any connections that I think might be interested.

Jason Busch

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