Daily Archives: July 2, 2012

Friday Rant: Where's The Gasoline Post Sandy?

William Busch - November 2, 2012 2:11 PM | Categories: William Busch

Answers to this critical supply chain debacle question are all over the map in today’s press from claims that refineries pre-emptively shut down as Sandy advanced, to mention of damage at refineries preventing them from coming back on line. But the real answer appears to be lack of electricity to pump refined fuel from stocked storage tanks and POS retail service stations. CNBC reports “The problem is not gasoline supplies, but the ability to distribute it, especially from the critical terminal area around Linden, N.J., which lost power and was hit by storm surge. An estimated 75 percent or more [...]

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Friday Latte: Helping After Sandy, CV Success, Payphone’s Heyday, US Adds 171,000 New Jobs

Sheena Moore - November 2, 2012 10:11 AM | Categories: Afternoon Coffee, Sheena Moore

How you can help! Hurricane Sandy: How you can help — Lots of ways to give, volunteer, and show that you care about those who were affected by Hurricane Sandy earlier this week. Picture or no picture?? Tips for CV success…. and more procurement jobs — If you haven’t done so already, and you’re interested at all in recruitment or being recruited, read our new article on Spend Matters search4 procurement – all about the psychological research that suggest whether or not we should attach a picture to our CVs. That’s our own picture, not one of Brad Pitt or [...]

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Prediction: SAP and Ariba Will Terminate the Current Network Fee Structure By 2015

Jason Busch - November 2, 2012 9:11 AM | Categories: Jason Busch, Spend Matters PRO

Closing out Spend Matters PRO week, we feature a prediction from a three-part series covering the future of the Ariba supplier network under SAP’s ownership and guidance (Spend Matters PRO subscribers can access the series here: Part 1, Part 2, and Part 3). Here’s the PRO call: SAP and Ariba will terminate the current network fee structure that charges a percentage of transactional value to suppliers by 2015 and replace it with flat connectivity charges (either annual subscriptions for basic connectivity or per-document pricing). Curious to learn more about the thought process behind this prediction? We hope you find the [...]

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JDA and RedPrairie Merge: Financial-Driven Supply Chain Rollup or Something More?

Jason Busch - November 2, 2012 1:11 AM | Categories: Friday Rant, Jason Busch, Optimization, M&A, Supply Chain

We’ll caveat this Friday rant on JDA and RedPrairie joining forces in a billion dollar merger with the footnote that our primary coverage area is procurement. We touch on supply chain topics and cover direct materials procurement extensively on our premium research site Spend Matters PRO — but there are better supply chain analysts who we turn to outside our own Six Sigma walls (even though we have one black belt on payroll) for advice on demand planning, forecasting, S&OP, etc. We know enough to be dangerous and have been involved in implementing and buying these systems in the past, [...]

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Optimizing Marketing Spend in a Digital World (Part 2)

Guest Post - October 2, 2012 12:10 PM | Categories: Alvarez & Marsal, Guest Posts, Industry News, Spend Management

In the last post in this series, Amy O’Brien-Bird and Bill Stotzer of Alvarez & Marsal discussed how companies can optimize their marketing spend through market segmentation and data management/measurement. This week, they continue. Diversify Buys: Digital technology has also spawned many alternatives by which to purchase media, including real-time media exchanges and other vertical markets allowing for media buys on the “spot” market. Even though the process for placing an ad through an agency has not changed dramatically from past practices, alternatives eliminate the need to involve an agency. For example, online services like Google’s Adwords and Craigslist can [...]

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Afternoon Coffee: $6bn for Boeing, American Airlines Loose Seats, Apple Tracks Laborers

Sheena Moore - October 2, 2012 10:10 AM | Categories: Afternoon Coffee, Sheena Moore

Big deal for Boeing. Boeing secures $6bn order from Brazil’s Gol — Boeing has secured its largest order from a South American airline, in a deal worth up to $6bn (£3.7bn). Brazilian low-cost carrier Gol is to buy 60 of Boeing’s forthcoming narrow body 737 Max aircraft, with the first due to be delivered to it in 2018. Gol said the new planes were 13% more fuel-efficient than its current fleet and would help to cut its costs. The airline is currently reducing its workforce by 2,500 jobs, or 12%, as it seeks to return to profitability. “An initial review [...]

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Getting Creative With Suppliers: Extracting More By Engagement, Not Extortion (Part 1)

Jason Busch - October 2, 2012 7:10 AM | Categories: Jason Busch, Suppliers

Over on Supply Chain Management Review, there’s a useful blog by Rob Swanson that asks the question: What Else Can My Suppliers Do? In it, Swanson does a quick and acceptable job of dispensing with the logic and common procurement argument of simply asking suppliers to do more for us (e.g., price concessions) versus actual engagement and collaboration. I’ve probably seen this argument made a hundred different ways. Swanson does it succinctly and eloquently. For example, “From the supplier’s perspective, reactionary requests, such as across the board price reductions are punitive. This approach puts the supplier on the defensive and [...]

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Procurement ROI: The Right Metric? (Part 1)

Jason Busch - October 2, 2012 4:10 AM | Categories: Analytics, Jason Busch, Procurement

Proxima’s Guy Strafford recently got me thinking (in a way he probably didn’t see coming) about the right ways to measure procurement effectiveness. In a post over on Proxima’s blog, Guy makes the observation that executives should be wary of high procurement return on investment (ROI) claims. He frames the argument by noting that he’s had conversations with many a procurement executive product of his “10x, 20x or even 30x ROI based on team cost” but that this measure “is far too simplistic … [and] misleading and are forcing the wrong behavior in our business leaders.” Guy then makes a [...]

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Managing Scope and Cultural Differences: Making Commitments

Guest Post - August 2, 2012 12:08 PM | Categories: Guest Posts, Outsourcing, Vantage Partners

Spend Matters would like to welcome a guest post from Vantage Partners. This is the first part of a five-part series focused on managing scope in offshoring relationships. Today’s post focuses on how cultural differences, in making commitments in offshoring relationships, make managing scope harder. Scope is challenging to manage in most professional service arrangement, and a challenging economic environment only increases the pressure on both sides to win that battle. In offshore deals, customers and providers must grapple not only with these familiar challenges, but also with the obstacle that hundreds of study participants, both customers and providers, identified [...]

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Afternoon Coffee: Apple’s Ad Spend, London Chooses Capgemini, Toyota Has No Remedy for Recall

Sheena Moore - August 2, 2012 10:08 AM | Categories: Afternoon Coffee, Sheena Moore

Remedy: buy a new car. Toyota Offers No Remedy For Newly-Recalled Cars — Toyota announced a recall of 778,000 vehicles, but it still hasn’t determined how to remedy their defect. As a result, drivers of about 760,000 Toyota RAV4s with 2006 through 2010 model years and 18,000 Lexus HS 250h vehicles from the 2010 model year may have to stop using their cars indefinitely. Toyota says that if suspension arm nuts on the recalled vehicles aren’t tightened properly, rust could form and lead to the separation of the arm from the vehicle. The automaker says it’s still working on how [...]

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Where Can Procurement Do More in the Area of Risk Management (Part 1)?

Jason Busch - August 2, 2012 7:08 AM | Categories: Jason Busch, Procurement, Supply Risk

Over on Procurement Leaders Blog, Novartis’ Sammy Rashed recently offered some observant words of advice focused on how procurement organizations can do more to manage supply risk. Referencing workshops he has held with various internal clients and stakeholders, Sammy opines that there are five separate areas where procurement can expand the “breath and depth” of its contribution to the practice of supply risk management. Further segmenting this list, he suggests each step beyond the previous brings “increasing complexity and benefits.” In a series of posts looking at Sammy’s recommendations, we’ll share each of his succinct points and provide additional insight [...]

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Exploring Big Data and Procurement Leveraging McKinsey’s Foundational Analysis (Part 3)

Jason Busch - August 2, 2012 4:08 AM | Categories: Analytics, Jason Busch, Procurement

Please click here for Part 1 and Part 2 of this series. Another fundamental benefit of big data strategies is that they will enable “experimentation to discover needs, expose variability, and improve performance,” McKinsey suggests. Elaborating on this observation, the authors suggest that, “as they create and store more transactional data in digital form, organizations can collect more accurate and detailed performance data (in real or near real time) on everything from product inventories to personnel sick days. IT enables organizations to instrument processes and then set up controlled experiments. Using data to analyze variability in performance — which either [...]

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Procurement Technology, Consulting Pricing Trends and Negotiation Strategies – Changing Times

Jason Busch - August 2, 2012 12:08 AM | Categories: Jason Busch, Procurement, Spend Matters PRO, Technology

We’ve received many queries lately about Spend Matters PRO content: What is it? How is it different from regular Spend Matters coverage? For the next couple weeks, every Thursday, we’ll feature a full article that has appeared on Spend Matters PRO. Keep in mind: this is the stuff that appears on Spend Matters PRO every single day. This content is bigger, more in-depth, and juicier than anything you’ve seen before on a regular publishing schedule. So enjoy the freebies…but for maximum impact, it’s best to become a Spend Matters PRO subscriber! Questions about Spend Matters PRO? Sign up right now: [...]

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4th of July Commodities: Getting More Bang for Your Buck!

Guest Post - July 2, 2012 12:07 PM | Categories: Commodities, Guest Posts, Mintec

Spend Matters welcomes a guest post from Robert Miles, at Mintec Ltd. The economies of the world seem to be spluttering a bit at the moment, and it’s that time of the year again when an awful lot of money goes up in smoke and colourful flashes of light. As you all know, this Wednesday is Independence Day. And what’s a good celebration without an equally breathtaking pyrotechnic display? Another reason to celebrate is that it appears the raw material cost of fireworks have been trending downwards, the essential elements in their manufacture have recently decreased in price. Modern fireworks [...]

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Spend Matters Afternoon Coffee

Sheena Moore - July 2, 2012 10:07 AM | Categories: Afternoon Coffee, Sheena Moore

PMI drops to below 50. Manufacturing Sector Shrank In June, Report Signals — For the first time since July 2009 a gauge of how U.S. manufacturers are doing is signalling shrinkage in the factory sector. The Institute for Supply Management says its June “PMI” indexstood at 49.7, down from 53.5 and the first time in nearly three years that it wasn’t above 50 — the line between growth in manufacturing (an above 50 reading) and contraction (below 50). “…A whopping 91 percent reported that they plan to reorganize their approach to risk management over the next three years.” Risky Business: [...]

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Growing the Market Pie: Expanding the Definition of Procurement BPO (Part 3)

Jason Busch - July 2, 2012 7:07 AM | Categories: BPO, Innovation, Jason Busch

Please click here for the first and second posts in this series. In looking at what fits into the current procurement BPO box — at least by popular definition, not the expanded one we considered earlier in this series — we see five distinct categories of solution: sourcing/category management, vendor management, P2P, transactional buying and AP/payment. The final two, transactional buying and AP/payment, are probably closest to what many have thought of traditional multi-tower BPO projects involving procurement in the past. Yet arguably, these are the least exciting areas to focus potential procurement BPO investment on. Sourcing and category management [...]

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