Many procurement organizations may wince at the idea of being called a "service provider.” The term seems very transactional and low impact. Most procurement organizations are striving for much deeper spend influence and usually prefer a term like "business partner." Yet the world is moving to a service orientation, not just in the consumer world but also in the business world, which in turn is becoming a digital world. Whether procurement groups choose to use the “service provider” terminology or not (e.g., the principles can be adopted without using the explicit terminology with stakeholder), they will need to consider a services-oriented operating model, or “service delivery model,” if they want to improve their delivered value. Here’s why.
The The Knowledge Category
A number of us at Spend Matters originally came from a consulting background where the project management office (PMO) function is an essential component of larger projects, especially around systems implementation or large-scale procurement and sourcing projects impacting a wide range of functions and individuals across a company. As background on the topic, Wikipedia defines a PMO as “a group or department within a business, agency or enterprise that defines and maintains standards for project management within the organization.”
One area that deserves additional consideration is GEP’s req-to-pay environment, which for many customers, could round out the rest of the integrated suite or stand alone in its own right. In recent years, through organic development and its acquisition of Enporium, GEP gained (and integrated) P2P capabilities including greater catalog management/search capabilities (with cross-catalog search and the ability to support both punch-out and hosted catalogs, more advanced order tracking/routing, invoice reconciliation, etc.)
Procurement has very little in the way of scientifically proven best practice, and not really very much even in terms of academic underpinning to what we do day-to-day. That is in part because many key procurement activities appear highly subjective and are linked to behavioural skills and issues, which are harder to analyse and study than fact-based actions. Such “soft” activities include negotiation, relationship management, and even arguably risk management.
In part one of our maverick spending series, Maverick Spending is Your Friend: Don’t Chase It, Ride It, we highlighted that while maverick spending in its own right is generally bad, its root causes often highlight problems with the procurement System (with a big “S”) that, if fixed, improves not only maverick spending, but other areas of procurement performance. In this second part of our series, we will highlight some proven practices to improve maverick spending performance beyond merely chastising malfeasant requisitioners.
In the first installment in this series, we explored the rather unique structure, capabilities and philosophy of GEP. GEP is a specialist BPO, consulting, managed services and software provider (not necessarily in that order, mind you!) serving the global procurement market. As we continue, we’ll consider GEP’s overall software solution capability as well, and in the concluding post, the characteristics of organizations most likely to benefit from their integrated approach to software and services delivery.
Hi PRO subscribers! We're pleased to bring you our first ever video post, featuring Jason Busch on some exciting changes coming down the pike for Spend Matters and Spend Matters PRO in 2013 and beyond.
Peter Smith was preparing punch cards to be run through the mainframe overnight at ICI (then the UK’s largest industrial company) while Jason Busch was learning to count in kindergarten. That being said, he has a career's worth of experience as a practitioner and thus offers a unique viewpoint on procurement technology.
In Part 1 of this series, we introduced the procurement productivity study and covered the first half of the productivity punch list. In this edition, […]
In April 2013, Spend Matters conducted a research study (sponsored by Hubwoo) with ISM (The Institute for Supply Management) to focus on how to improve procurement productivity. Even though procurement has a >10X ROI as a function, it is still under the same pressure as other functions to improve productivity, especially since they’re typically asked to do even more (beyond spend savings) with less. So, we came up with a punch list of 25 things that procurement organizations could do to free themselves up from the tactical and focus on the strategic.
Firms need to move away, even if only slightly, from their unrelenting focus on driving down costs. Addressing these issues also requires buyers to have a better understanding of their supply chains and suppliers. The first step towards doing anything positive for the workers is to have customers know and understand who is doing what for them in their supply chains. Without that knowledge, nothing can be achieved. But in many cases, the web of contractors, sub-contractors and sub-sub-contractors is complex and opaque. It’s no wonder many buyers give up and just hope for the best in terms of their supply chain risk strategies.
Earlier this spring, Pierre Mitchell and I had the chance to sit down with GEP at their global headquarters in New Jersey. During the discussion, we learned quite a bit about this unique firm’s offerings, market positioning, and strategic direction. Because GEP is attempting to go where few have successfully gone before – combining significant proprietary software assets in an end-to-end procurement suite with both BPO and consulting services – it is worth stepping back to understand a bit about the provider’s offerings, history, and current go-to-market approach. Later we’ll offer our analysis about how GEP stacks up in the broader market compared to other services and software providers.