Daily Archives: December 2, 2013

Flaws Exposed in the Federal Procurement Data System

The Government Accountability Office has found that the Department of Defense and the General Services Administration—the two federal agencies that account for the vast majority of consolidated contracts—misreported the number of consolidated contracts in fiscal year 2011 and 2012. The GAO reviewed 157 contracts, and found that 34% of the DoD contracts reported as consolidated, and none of the GSA contracts designated as such, were in fact consolidated, leading the GAO to conclude that the two agencies “do not know the full extent to which they are awarding consolidated contracts.” The GAO also found four DoD contracts that were consolidated, but were not reported as such.

PVC Prices Fall, Along with Production Cost of Artificial Christmas Trees

Real or artificial Christmas tree? There's a financial incentive for the latter. Chinese PVC prices have been falling due to good stocks and the drop in demand as building construction slows in the Northern hemisphere during the winter months. Steel prices have seen some minor increases this year, but prices are still lower year-on-year, for a similar reason. Paper packaging prices have been falling, with cartonboard down 7% and testliner down 9% year-on-year.

Amazon’s Ambitious Drone Delivery Service, Lackluster Black Friday Spending, Fast-Food Wage Protest

Amazon CEO Jeff Bezos unveiled a drone delivery service, named Amazon Prime Air, that may be ready for customer use by the end of the decade. Black Friday spending was lackluster this year, marking the first spending decline on a Black Friday weekend since 2009. Afternoon Coffee brings you the latest news in spending and procurement.

Geospatial Category & Supplier Management: Exploring Sourcemap (Part 1)

Sourcemap is a software platform that helps organizations map, understand and manage their wider supply chains. It also enables them to go beyond conventional communication methods and use social media, crowd-sourcing to gain greater commitment and understanding of supply chain initiatives … [Bonanni’s] initial vision was a website that physically mapped organizations supply chains. Firms were invited to enter their own supply chain details into the Sourcemap website, which would display the results. Suppliers or others could then add detail to the maps and expand on the supply chain knowledge – crowd sourcing, if you like.

Supply Risk Management: Exploring A Real-World Case of Strategy Risk

Oftentimes, companies fail to align their business and supply strategies, choosing to tackle one-off savings opportunities instead of developing a holistic approach. 
For example, if a company embraces lean manufacturing principles on the corporate level, logic dictates that a key supply management strategy should be focused on identifying, partnering, and developing suppliers who can support lean production techniques. 
In some cases, a supply management organization might find that external suppliers are more capable at manufacturing or providing a specific service. In this case, the buying organization might opt to source to outside suppliers to meet their supply need rather than attempting to do things themselves.

Don’t Avoid Cost Avoidance (Part 2 – The CFO and CPO Fireside Chat)

In the first of this 2-part series, I argued strongly for the value of cost avoidance as an important performance metric. In this second part, I will illustrate the concept via a story of a CFO and CPO having a discussion about measuring procurement value. This is basically a pathetic attempt to write a procurement version of something like Eli Goldratt’s The Goal.

The Value of Procurement in Product Development

To keep pace with business demands, the procurement function continues to adopt more strategic tasks that extend its capabilities beyond simply purchasing. Shifting the focus to what the business needs to accomplish its goals allows procurement to consider elements such as supplier quality and reliability and to interact with other areas of the enterprise.

New Microsoft EA Licensing Program Spells Higher Costs for Enterprise Customers

On November 10, 2013, Microsoft will debut its new SCE licensing program – a three-year enrollment under the Microsoft Enterprise Agreement (EA). This program will effectively replace two of the most popular EA licensing programs, ECI and EAP, as well as raise EA costs for most enterprise customers. In most cases, SCE discounts are lower. Under EAP, customers have received a 40 percent discount off of License and Software Assurance (L&SA). Under ECI, the discount has been 20 percent. Yet, under SCE, the discount drops to 15 percent.

Apple Supply Chain Delays, Hiperos Receives 2013 GRC Value Award, Google Accused of Wiretapping

Apple, Inc.'s supply chain is just now getting ready to make retina displays for iPad Minis, which means that a wide roll-out will not happen by the holiday shopping season. Oxfam is accusing suppliers to Coca-Cola and PepsiCo of taking land from indigenous communities for the purposes of planting the lucrative sugarcane. Afternoon Coffee brings you the day's news in supply chain and procurement.

More Coupa Numbers and “The Largest Free Supplier Network”

Raja Hammoud, Coupa’s VP of Product Management, was the second main presenter this morning at Coupa’s One Vision Roadshow this morning in Chicago. The focus of her discussion was Coupa’s positioning, vision, and roadmap. Front and center of her talk was Coupa’s goal of helping companies get external “dollars under management” as a first step when they work with a new organization. This is because control and management of spend becomes the ante for enabling procurement and finance to optimize spend in such areas as sourcing and working capital management.

Coupa One Vision Roadshow Stops In Chicago: A Coupa Numbers Update

Three members of the Spend Matters team (Sydney Lazarus, Lisa Whalen, and Jason Busch) are at the Coupa One Vision Roadshow in Chicago today. Chicago is one of nine stops on the 2013 tour. The turnout is bigger than last year – and represents a solid audience turnout for a regional event. Roughly 70-75 people are in the room. I’m presenting last today, offering up both an historical look at P2P and a forward-looking vision (the talk is titled: P2P: From “Model T” Fundamentals to “Beam Me Up” Advancements).