For many firms, category management is a foundational element of their procurement operating models. I’ve defined category management as the cross-functional (and cross-enterprise) processes for managing the lifecycle of supply for major spend categories – within which strategic sourcing is obviously a core process. Category management typically organizes clusters of supply markets for such management and assigns responsibility of these processes to category managers who will then “plug into” the organizational hierarchy depending on the operating model. The organizational hierarchy itself is driven by geography, product/service line (which is focused on the supplied solutions or the served industries), function, etc. But wait, it gets more complicated.more ▸
At least, I conclude that American Express' expense reporting tool's developers don't use the card themselves. Maybe it isn't popular in India, or wherever the new AmEx site was coded. It certainly could not have been built by an experienced card user here in the US. In fact, the redesign of the AmEx tool is so bad that it has to be labeled as beta - not "client ready," to use financial industry terms. So what are the problems?more ▸
While in business school, together with 5 other students and the dean, I was given the opportunity to have lunch with GM's then-CEO Jack Smith (GM CEO between 1992 and 2000), and I asked him why GM wasn't using its German brand better. I brought up an example from Japan – where I had lived up until a few months earlier and where GM was actively promoting its full-size vans at the time. Sales of these absurdly large, gas guzzling, and dubious reliable vehicles must have been negligible. I never saw one on the roads. I suggested GM leverage Opel, which already is the right size for the market.more ▸
Don't you just hate it when applications and web-based SaaS solutions look cool, but once you start using them, you run into issues with the slick buttons (having to click once on everything to figure out what the icon means) or you just can't figure out where a certain feature is (assuming it even exists, but how can you know for sure?). "Mystery meat" is what I call these features.more ▸
I’m writing this from the airport lounge at Heathrow, flying back to Chicago (for the Chicago Marathon this weekend) after a great few days on the road with my UK business partner and colleague Peter Smith. In my travels on this side of the pond, I’ve always found London to be a truly great city to connect with people in any profession because, unlike any cities in North America (except perhaps Toronto or Mexico City), it’s a true hub.more ▸
For most things in life, there’s the good, the bad and the ugly. So be it with procurement research. I’ve been doing procurement research for a long time, and have seen some really good stuff from all sorts of firms. However, I’ve noticed lately a marked increase in quantity of research surveys and an unfortunate commensurate drop in quality. “So what?” you say. “What’s the problem here?” The problem is that practitioners are surveyed to DEATH by one other (e.g., advanced firms getting hit up by others) and by third-party firms from numerous provider sectors. And when the research is sketchy, it drags everyone down.more ▸
CPO’s love to network and learn from one other. And tons of firms are happy to host them for such intimate gatherings. I’ve facilitated many of these sessions – and it’s all good. But, inevitably, the strategies, techniques and transformation stories begin sounding very similar. Innovation begins to falter and procurement can find itself falling back on old ways.more ▸
Normally, my primary concern is that the plane will leave on time. For instance, one day in June this year, I experienced TWO big bird mechanical failures in a row (!) flying out of Atlanta, barely made it in time to Singapore via a weird European detour thanks to heroic efforts by Fernando, an extraordinarily capable member of Delta’s ground crew. Thanks Fernando!
A secondary concern is wondering whether I will be able to stow my carry-on luggage.
Thirdly, and a far more minor issue would be, who will sit in the middle seat?
Earlier this week, however, a fourth concern reared its ugly head – or nose – and I can't see a way to mitigate against this.more ▸
“Best practices” have been getting a bad rap lately. It has become fashionable to poo-poo them as cookbook techniques based on stale thinking that get rotely applied and misapplied by folks with sloppy thinking or something to sell you. Makes sense right? A hundred years ago, using a longer-lasting buggy whip was likely a transportation management best practice. Or let’s take a more modern example: p-cards. P-cards used to be a broad-reaching best practice to reduce transaction costs for low dollar spending, but now, many firms have minimized p-card adoption as other electronic buy/pay methods have become more robust.more ▸
For those who have been around the economy awhile, the current 6.1-percent unemployment looks nothing like the 6.1-percent unemployment we had in the summers of 1994 and 2003. Here is why: the BLS has constantly redefined away the problem of persistent unemployment, simply removing the annoyingly unemployed from the statistics and focusing on tracking merely changes in the employed versus the recently unemployed. That’s like saying “Well, that supplier has failed so long that we’ll just not count their broken parts in our QA stats.” That doesn’t change the fact that there’s a lot of failure out there.more ▸
Maybe it’s not so much a question of “will we,” but should we have any major corporations left in the United States come the start of the next decade? I’m speaking of corporations headquartered in the country, that is.more ▸
In my years of researching and assessing sourcing sophistication and approaches inside procurement organizations from around the globe, I’ve noticed there’s a universal bent – except perhaps in the most corrupt developing markets – to begin to discourage biases to/for one supplier or another in the sourcing process at the early stages of procurement maturity (after, let’s say, a base “stage zero”).more ▸