Sourcing complexity can serve as a barrier to pursuing potential high-reward and high-risk procurement initiatives. But complexity does not have to stand in the way of savings, total cost or other improvements. Identifying how to pinpoint complexity is essential. An important place to start here involves fully exploring factors that drive sourcing complexity. In the paper
Category Archives: Procurement Research
Yesterday, I shared some of my foundational arguments about spend visibility and spend and supply analytics maturity from a Spend HQ webinar, The Spend Visibility Curve: Where Do You Stand. As part of this discussion, I introduced a 4-stage spend visibility maturity model that begins with what I termed “sourcing and measurement.” Sourcing and measurement provides a spend visibility foundation that continues throughout the model and, in fact, has its own layers as well.
Consero Group published the results of a CPO forum it held this summer and captured some data from the 47 participating CPOs. Consero is one of the many executive peer networking groups out there, and although this survey wasn’t exactly on the cutting edge – only 37% of the firms have spend under management over the 50% level, and the questions indicated Consero isn’t likely staffed by procurement experts – the survey seems to be a decent bellwether of the industry at large.
Earlier this year, my colleague Peter Smith, who serves as managing director of Spend Matters UK/Europe, wrote an outstanding paper we somehow overlooked on this side of the Atlantic. The topic of his analysis: What Defines Complex Sourcing – and Why Does It Matter? Let's dive into the salient ideas.
In a recent article, "What Happened to FMS in the Past Year?” we discussed the emerging category of freelance management systems (FMS) and posed a question to presumptive FMS solution providers: What has happened over the past year? We did get some responses, and in this follow-up article we provide a synthesis of what we heard (or thought we heard).
In Accenture’s most recent study on procurement, Procurement’s Next Frontier – The Future Will Give Rise to an Organization of One, the authors suggest the “virtual company mall” will provide the wrapper for the core of a firm’s shopping and tactical buying experience – i.e., how frontline users – and perhaps even procurement – shop for and purchase goods and services. It’s a clever thought to suggest that a single toolset – or more likely a single interface for users – will form the basis of a shopping system. It’s also clever to call it a mall, since within a mall, much like the future buying system the authors describe, there can be different branches or anchor stores as well as all of the individual merchants in smaller spaces that sell their wares. Yet for this analogy to work, a lot of elements need to come together.
In Accenture’s daring report, Procurement’s Next Frontier – The Future Will Give Rise to an Organization of One, the authors spend a bit of time exploring the future of procurement technology. In fact, they suggest 5 areas that are likely to augment or replace today’s current tech investments. One of these technology areas Accenture describes as “the virtual company mall.” In Accenture’s words, the virtual mall will comprise a cloud-based set of pre-approved private and public “shops” from which internal customers can select goods and services, supported with business logic that guides their purchasing based on policies, preferred suppliers and contracts. But what will it take to for this virtual supplier mall to become a reality?
Earlier this summer, Accenture published one of the most inventive and daring pieces of research on the future of procurement to date: Procurement’s Next Frontier – The Future Will Give Rise to an Organization of One. Based extensively on interviews with procurement organizations as well as some of the best minds within the firm, it’s anything but the conservative white papers that often come out of consultancies. In fact, I would go so far as to say it’s daring – and very daring for Accenture! Authored by Kai Nowosel, Kris Timmermans and Abigail Terrill, the paper argues that procurement will fundamentally change in structure, integration and digital enablement. Central to the argument of how the new procurement organization will operate is an evolution of technology.
Attention, Practitioners: If you want to build a “modernist procurement” organization – and truly benchmark yourself against your peers – you have 1 week to participate in this 5- to 7-minute snap poll we’re doing in conjunction with the Institute for Supply Management (ISM) ahead of the ISM Metrics Symposium. Our snap poll simply asks your take on the “procurement value mix” (i.e., the percentage breakdown of the various types of procurement value-add) today and in 3 years. By seeing how and where the value streams will shift, you’ll also be able to plan for which competencies you’ll need to invest in. But let's back up – how do we define a "modernist" procurement organization exactly? Read on...
Over on Chief Procurement Officer, we recently began a countdown series of the top 17 ways finance can help procurement. Authored by Chief Research Officer Pierre Mitchell, the series, or wish list, is based off a snap poll Spend Matters and the Institute for Supply Management conducted regarding the alignment of procurement and finance organizations within a company. The series hits on the least important to most important ways procurement would like finance's help improving supply and spend management. (No. 1 will be the most important.) So far, Pierre has hit on tips Nos. 17-15. You can read the full articles over on Chief Procurement Officer, or read on and follow the links.
Jason Busch, founder and managing director at Spend Matters, teamed with Vroozi to come up with a new “buying manifesto” for procurement professionals that is not only relevant today but into the future as well. In Declaration of the New Purchasing: A Buying Manifesto, a new, FREE research download, we predict what the future holds for procurement. In support of this collaborative research with Vroozi, Jason started an ongoing series of articles featured on Spend Matters that support this new buying manifesto. The first touches on “Technology in Our Personal Lives.” Check it out here.
We’re in the process of wrapping a joint Spend Matters/ISM snap poll exploring the relationship between finance and procurement, and more specifically, how to get more out of it on a pragmatic level (no one needs another study that just talks about the roots of “misalignment”). As part of the research, we asked participants why procurement should report into finance. Some of the responses include “senior management influence,” “ability to control budget and cash outflows,” and more. Read on to see what participants had to say.