Webinar Recap: How Catalogs Benefit The Sourcing Process, Lead to Savings

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A couple of weeks ago, we had a very interesting webinar about the evolution of catalogs and their benefits in the sourcing process to realized savings. Laura Lee, VP of procurement at CEMEX, joined us for the event, as did Pierre Mitchell, chief research officer at Spend Matters, Jessica Warren from Hubwoo and myself (from Spend Matters México y America Latina). One of the things that grabbed my attention was the number of participants that registered for the webinar ­– over 400.  Seems that this is an important topic for practitioners.

An interesting fact discussed during the webinar was the value proposition that is expected from catalogs to really develop all its potential during a sourcing event, which included: integrating more complex products and services to increase “spend under management,” integrating catalogs with contracts to enable compliance, drive process efficiency, improve data quality and analytics, improve supplier enablement and collaboration, establish a “guided buying” approach and user personalization experience.

During the webinar, CEMEX discussed its business case to implement Hubwoo catalog technology, which seems to be working successfully. Here are some questions we asked the participants and answers from CEMEX. (You can also listen to the recording of the webinar here.)

 

Spend Matters: How do you define “traditional catalogs?” Does this refer to supplier catalogs or buyer-side catalogs? Can supplier catalogs be integrated somehow? And, how are the products that are put in the Marketplace sourced?

CEMEX: Products/catalogs are previously negotiated by the procurement team and uploaded into the Marketplace site. The buyer is not restricted by the system to buy only in Marketplace, however, monthly scorecards by business unit and PO creator are shared throughout the business, highlighting smart buying opportunities.

SM: What is the scope/what categories are you focusing on? 

CEMEX: MRO, safety/PPE, fleet aftermarket parts and services, services, equipment rentals, office supplies, etc.

SM: What is the percentage of indirect spend that you put into the Marketplace - how did your journey progress from 2012 to 2015? Did you employ category-specific tools linked to the Marketplace (i.e. travel management, temp labor, etc?)

CEMEX: Indirect spend under management began at 15% @ Go-Live, and is now 60% currently. CEMEX Marketplace today is a standalone within Hubwoo.

SM: Did you need to modify any policies - including delegation of authority - and was finance an enabler or roadblock in transformation?

CEMEX: No policy changes were needed, as Marketplace Shopping Carts are fully integrated into our SAP PO approvals.  CEMEX Finance clearly an enabler of the transformation.

SM: What is your approach to product classification/categorization so that a user does not need to know what is in each catalog before making their choice?

CEMEX: CEMEX Marketplace today uses UNSPSC code ­– 90% hosted, 10% punch-out.

SM: How many resources are dedicated to content administration (either for buying or contracts if the effort is separated)?

CEMEX: Category leads are responsible for content administration. One additional resource, SRM Coordinator, facilitates catalog management between procurement and suppliers.

SM: Are there any elements of "social" feedback on items for suppliers that is collected (and exposed) to your employees in guiding selection?

CEMEX: Yes, buyers may "star-rate" individual items and post review/comments.

SM: Is there any benchmarking (against external data sources) for items to help reinforce the value of content (and procurement's efforts)?

CEMEX: Yes, benchmarking on content - strong during design and go-live. Our "Shop.Save.Earn Rewards" campaign recognizes top performing buyers as "Regional Leaders" each moonth. Buyers may also earn gift certificates for “Top Performing Region” and “Most Improved Region” to be awarded in December.

 

 

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