Category Archives: Commentary

Approaching Data Security: IT Procurement in the Time of World War Zero

- July 31, 2014 2:53 AM | Categories: Commentary, Industry News, Innovation, Technology

Lock Organizations need to realize a simple truth. Today, there is simply no distinction between an organization’s IT strategy and its overall strategy. And as we have seen, when an organization experiences a major IT embarrassment, there are larger, strategic ramifications that must be dealt with, often with very expensive and long-lasting consequences. Protecting customer data is a requisite for retaining the trust and loyalty of customers. And as the Target case has proven in recent traffic numbers for the retail giant, shoppers will be slow to come back to spend both on your website and in your stores after a major data breach.

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P2P and Procurement Applications: The Cloud Ain’t So Simple

- July 30, 2014 10:25 AM | Categories: Cloud, Commentary, Procurement Strategy & Planning

Earlier this month, Procurement Leaders published a blog post titled: Has The Cloud-Based Solutions Market Turned A Corner In 2014? Citing the case of a relationship between Accenture and SAP/Ariba to deliver “a new cloud-based solution … designed to transform the delivery of procurement and finance and accounting (F&A) business services to its customers,” PL then raises the question of whether “the hype around the cloud signaled a wider shift in the market.” But the cloud isn't so simple. There is a range of vendors (including SAP/Ariba) selling solutions that can be configured in a hybrid manner in which data is stored and delivered through different applications in a virtualized manner.

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When Policy and Supply Chain Traceability Requirements Do More Harm Than Good

Are we becoming a victim of our own supply chain policing, in that regulatory requirements are driving us to make sub-optimal decisions? In a must-read column in Sourcing Journal Online, Stephan Lamar, executive vice president at the American Apparel & Footwear Association (AAFA), presents the case for how the avoidance of one material in shoes and apparel led to potential non-compliance in another areas.

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Information Spend Matters: Procurement Should Think Twice before Cutting Paid Subscriptions

- July 25, 2014 6:39 AM | Categories: Commentary, Friday Rant, Spend Management

physical newspapers While there are major strategic implications for media companies and society as we turn into a culture of “free” news and information, there is one group of people that still expects to pay for their information: business executives. As companies look to cut costs by shifting from paid subscriptions to free sources of similar news and information, it is likely that they will find stiff resistance from executives. While moving to free news sources might make short-term financial sense, a recent study has found that executives around the world use and trust paid media in a way that produces value for themselves and their companies.

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What Do You Mean, a Coed Sauna? On Sourcing Activity Synchronization and Customers

Screen Shot 2014-07-23 at 5.03.41 PM Art van Bodegraven, managing principal of Van Bodegraven Associates and founding principal of Discovery Executive Services, is back with another essay for Spend Matters. As we look for better ways to integrate and synchronize sourcing and procurement activities intelligently within the greater supply chain, it is easy to become confused about who and where the customers are. You know, the ones we are supposed to be delighting? This is a burning question in both the B2B and the B2C worlds. And the obvious answer is not always the complete answer. For example, when a company's customers are the ones actually paying the bills, and the sales and marketing mission is to get them to buy as much as can be rationalized, plus some extra “just in case,” we cannot afford to overlook sales and marketing as an internal customer, whose needs and demands we must at least recognize.

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Supply Chain Cops (and Robbers): On Conflict Minerals Compliance in Secondary Industries

In a Sourcing Journal Online column that’s a must-read for any industry, Stephan Lamar, executive vice president at the American Apparel & Footwear Association (AAFA), frames the costs and hassle of conflict minerals legislation for the industry he represents. As he writes, “although [the legislation] was aimed at the electronics industry, which is a massive user of these materials, the broad reach of the regulation has ensnared our industry as well. For the past 18 months, U.S. footwear and apparel companies have spent thousands of dollars and hundreds of man hours in a desperate effort to come into compliance.”

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Has Supply Chain Policing Gone Too Far?

Is Dodd-Frank really necessary (and if it was wouldn’t it have been implemented yet)? Why do most of the most successful supplier diversity programs we can point to have little focus on adhering to requirements for government contracting and more on doing what is right by customers and growth market segments? And perhaps most serious of all, why does China care about REACH/ROHS and even clean energy when they can’t police their state-owned companies? Nor can they go after suppliers that these organizations purchase from for behavior that would be aberrant in more civilized countries – labor practices, counterfeit and often dangerous materials/substances, theft of IP and other trade secrets, and just about any other supply chain risk infraction you can point to in recent news headlines.

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The Love of Pulp — and How to Get the Wall Street Journal on the Cheap

- July 18, 2014 10:06 AM | Categories: Commentary, Travel

Man with newspaper on ordinary bench Living in the Atlanta area, I have a certain travel bias in favor of Delta – can’t be helped – so I rack up SkyMiles at a good clip. And here’s the trick – you use your miles to pay for the WSJ. Ok, so it’s not entirely free but comes pretty close. Delta has changed partners for this over the years. Right now it is a company called Newspaper Rewards, and the deal has only gotten better since I got my last subscription. I had to hand over 2,700 miles for about nine months (I think – I renewed back in July last year, but the copies keep coming…) of just the print edition. Now the deal is even better – pay 2,417 miles for 39 weeks of the print and electronic editions. And what's more -- having a newspaper subscription doubles as a weather forecast.

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Beware Ariba’s Patent Treasure Chest: Sourcing and eProcurement (Part 2)

This is the second in a multi-part series on Spend Matters Plus. Read Part 1 here.

As our exploration of Ariba’s extensive and deep patents continues, we turn our attention to three specific patents tied to sourcing and eProcurement. Ariba’s stash covers a broad range – and a good deal of provider companies in the market can't avoid being in violation. That said, to us, many patents appear to cover either features used prior to the filing date – prior art, as the legal term goes – or be overly broad or otherwise fairly trivial. However, if and when Ariba decides to release their legal hounds, a good number of companies will likely be dragged in. Some providers might have struck licensing deals, and for those with IP portfolios of their own there is always a mutual cross-licensing arrangement to be made. In this Spend Matters Plus research brief, Thomas Kase, VP of research, discusses the following Ariba patents: auction bid and visibility restrictions; eProcurement (“figuring out if your supplier is on the Internet”); and supplier connectivity.

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Procurement Provider Net Promoter Study

- July 17, 2014 11:11 AM | Categories: Analytics, Commentary, Procurement Research

We’re launching the first round of an ongoing “benchmark” survey that gauges procurement provider satisfaction scores for six different procurement process areas. In each, we measure importance, level of automation, currently selected vendors (as well as current/planned technology approaches), and of course the satisfaction score used to generated a promoter score. Depending on the answers to the questions, we also ask a few follow-on questions (e.g., what were the biggest reasons for low promoter scores) and finish off with some questions on major gaps with existing provider offerings (in addition to emerging technology areas). The first 100 qualified practitioners to participate get their choice of three incentives!

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Ariba the Avid Patent Collector: Analyzing Three That Should Keep Providers Up at Night

Patent Office Intellectual property rights and patents are great assets for many companies and procurement are at least partial stewards of them. They are often attractive assets of course (even from just a sales/marketing perspective), but they are sometimes open to legal disputes. In the case of procurement solutions, competing vendors have material legal exposure – in part because there are so many competitors in the sector that have filed for protections with the US Patent Office.

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Supply Chain Risk From an Insurance Provider’s Perspective: “The Shot Heard Round the World”

- July 15, 2014 10:26 AM | Categories: Commentary, Supply Chain Management, Supply Risk Management

I was recently at an analyst event for a software company and sat across the table at a breakfast with a technology researcher who covered the market for insurance companies. I asked the analyst, who had spent over 20 years in the industry, what it was like to look at solutions from an outsider’s perspective and what trends she sees as shaping the market. Almost on cue, the topic of discussion shifted from underwriting and claims management to that new topic of general procurement and finance interest: supply chain risk management. Given her generalist insurance background, I had no idea what to expect when I queried her on the subject, but what I heard back was as expert – or more – than anything I’ve heard from a non-insurance perspective.

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