The Procurement Commentary Category

Traditional or Nurturing? 2 Methods for Recruiting Procurement Professionals

Spend Matters welcomes this guest post from Zelim Suleymanov, chief executive of PrECA.

It is not easy to find a top-class procurement professional. On the one hand, purchases require best practices expertise, and on the other hand, they need unconventional thinking and a creative approach. Highlights and challenges of up-to-date recruiting techniques with a focus on procurement can be found in a number of resources. Among them is procurement talent management and related issues described by Charles Dominick of the Next Level Purchasing Association.

I would suggest two possible headhunting models that can be used either individually or in combination when recruiting employees. They are what I call traditional and nurturing methods.

Catching Up with a Marketing Maven and Talking Vertical Procurement Solutions

Last week, I had the chance to sit down with Jaggaer’s Steve Lundin at our office in Chicago, to talk verticalization in regards to procurement solutions. As Steve said, “I've been dabbling around the supply chain space for years, and know that software companies have dipped their toes in an out of developing targeted products. What's happening now, with industry targeted vertical procurement solutions, reflects what we've seen in the consumer market, with B2C being the tail that wags a B2B dog."

A Guidebook to the Rise of Industry-Specific Procurement Technologies: Related Markets, the Why and the Where [PRO]

By Spend Matters estimates, over 80% of dollars spent on procurement technology in recent years has been for standard source-to-pay products (e.g., spend analytics, sourcing, contract management, supplier management, e-procurement and invoice-to-pay) that were not specifically designed or configured — prior to deployments — to support industry-specific requirements. Granted, there have been some notable deviations to the rule (which make up the 20%), such as healthcare-centric solutions, certain areas of public sector, supplier compliance in regulated industries, supporting specific collaboration requirements, manufacturing requirements and so forth. But these have been exceptions rather than the norm.

Something new is afoot, however. There are a number of signposts which point to the pending rise of industry-specific solutions more generally for procurement technology — i.e., those solutions which are either designed from the start or come pre-configured to meet the specific needs of a given market.

This Spend Matters PRO research series provides a guidebook for organizations that are interested in this change, the drivers behind it, and some trends and examples that we’re seeing in the field. It explores when industry specific procurement technologies are likely most appropriate (or not), what technologies are likely to be affected, lessons from related markets (e.g., finance/treasury, supply chain, supplier and third-party management) and provides a summary and analysis of recent news from Jaggaer, Ivalua and SAP Ariba detailing their emerging approaches to verticalization. It also provides recommendations to procurement organizations, solution providers and consultancies that are looking to take advantage of this shift (or not get left behind by it).

A 21-Question Health Check to Score Your Procurement Scorecard (Part 3) [Plus+]

As the old business adage goes, “what gets measured gets done.” This is certainly true in procurement. If you want to do the right things for yourself and your stakeholders, you need to measure the right things and do it efficiently. You also need to ensure that you are measuring what your stakeholders want and what you are in fact delivering. It’s a foundational competency. In fact, in the most recent Hackett Group procurement key issues study, “value contribution visibility” ranked third in terms of procurement key capabilities that were viewed to be major or critical. This is the last post in a three-part series providing a 21-question “health check” for your procurement scorecard, this time covering questions 16-21.

CRM for Procurement: Lessons from the Sell Side [Plus+]

In a world where everything is quickly becoming a service (XaaS), perhaps the single most important differentiator is being customer-focused and aligned in order to allow you to deliver value to them over the long run. It is a simple principle, but procurement is not so easy to implement. Everybody who spends money in the enterprise has the potential to get more value from their spend and is a potential “customer” for procurement to help. Given procurement’s limited resources, adopting and adapting CRM principles, practices, and tools can help. As we get started, note that CRM for “supply” and suppliers is not the buy-side of “SRM” or supplier management – it’s a much bigger, hairier, and more encompassing beast.

So who are the customers? And should they even be called customers?

Many procurement organizations do not like the term “customers.” Some use the term “clients,” and others use the term “stakeholders.” Still others use the term “internal partners.” It doesn't really matter as long as the organization defines the nomenclature that works best for them. That said, it is important to understand who all the various stakeholders are within the procurement process, so that they can be appropriately targeted to drive more value out of the process. In fact, if you think of the term "stakeholders," it means anyone who has a stake in the process and who consumes the outputs of that process: information, materials, services, cash, goodwill, etc.

So, to be a stakeholder in a procurement process means to be a customer of that process. This means that procurement needs to be explicit in defining and working with 10 key stakeholders – and reconciling which of these will get the most attention.

Let’s get to the list (and beyond that, 14 critical areas of CRM begging to be addressed).

Breaking Down Global Silos (Part 1): Did Rio Ruin Houston’s New ERP Launch?

I sat in front of a camera that appeared to pan around the office — even though it was powered down.

As I tinkered with three remote controls, attempting to connect our virtual conference room to one in the southern hemisphere, I could not suppress my most paranoid instinct that perhaps our headquarters in Rio de Janeiro bugged our equipment to allow them to monitor the movements and voices of their North American employees.

My supply chain counterparts in the Brazilian corporate headquarters of one of the world’s largest oil and gas exploration companies called an ominously last-minute conference on a particularly sweltering spring day, which was already packed with activities for our impending ERP “go live.”

Rethinking Sourcing Suites and Their Sub Components — Gartner’s 2017 Magic Quadrant

Gartner recently came out with their 2017 Magic Quadrant for Strategic Sourcing Application Suite review. There was material movement from this year’s quadrant compared to the previous one that was published two years ago, and in this post we offer our commentary on it.

Without question, Gartner has some of the best minds in the technology research sector. But given the pace of technology providers’ innovation, our perspective is that the notion of publishing a report every two years is not terribly useful outside of the point-in-time snapshot — which may in fact be six months old by the time a report is published — that a comparative analysis provides. In the end, for better or worse, the Magic Quadrant becomes ubiquitous with IT professionals to shortlist vendors (and sometimes more) and often a CYA for procurement.

Why Procurement Is a Vital Seat at the Executive Table

Spend Matters welcomes this guest post from Stan Garber, president at Scout RFP.

It’s no secret that handling large enterprise costs in a siloed, departmental manner is detrimental to the business. Not only is it inefficient, but it also reduces the organization's overall competitive edge and increases its operational expenses. With the office of finance putting more emphasis on cost reduction, vendor consolidation, and impactful suppliers, strategic sourcing has emerged as a top priority in 2017. As such, CEOs are looking for procurement teams who can execute cost effective strategies and manage operations and outsourcing with aplomb.

Bleeding on the Bayou: Procurement Near-Misses in Times of Price Volatility (Part 1)

Editor's note: This post kicks off a new Spend Matters series of personal narratives from practitioners in the field. Know someone with a procurement story to tell? Tell us in the comments below!

“2-3/8 pipe, 4-1/8 pipe, 6-3/8 aluminized, 6-3/8 anodized, 6-3/8 black vinyl coated, 6-3/8 green vinyl coated…”

Fred Farmer’s interminably slow drawl echoed off the rickety galvanized siding of his Louisiana based hot rolled steel tube factory, unfortunately located on the banks of a bayou threatened by frequent floods and the occasional alligator infestation. Farmer’s proud and emphatic articulation of his exhaustive product catalog called to mind a veritable Bubba Gump of the steel tube industry. He was born and raised in a rural Louisiana town called Ponchatoula about fifty miles outside of New Orleans, and rose up the ranks from maintenance, to line supervisor and ultimately CEO after his uncle Willy succumbed prematurely to a heart condition (most likely brought on by decades of fried alligator and beignets consumption).

It’s 2017 — Here Are 5 Key Areas Procurement Needs to Pay Attention To

Happy New Year, Spend Matters readers!

No crystal ball could have prepared us for the smorgasbord of change that this past year presented.

So, how should those of us in the supply chain and procurement sphere be preparing for the next 365 days? What should be top of mind? Read on to find out.

Using DMAIC 2.0 to Blow Up the N-step Procurement Process [Plus+]

An n-step chevron process is a siloed procurement-centered sourcing methodology geared towards supplier rationalization. It’s a fine start for procurement hitting cost savings goals, but it’s not a great way to align to the broader organization as procurement evolves. So, we’re proposing DMAIC as an emerging, superior approach, but it’s far beyond the DMAIC that you usually think of. The n-step sourcing process has had a good run, but let’s not try to make it do unholy things. Read on to see how other companies have used DMAIC.

Why You Need to Push Your Business Through the Pain of Transformation

Spend Matters welcomes this guest post by Conrad Smith, senior director of global procurement at Adobe. Like running, procurement transformation can be painful at first, but it’s worth it. Here’s how, and why, you should be pushing for transformation in your people, your processes and your systems; in procurement, or whatever else you own.