Category Archives: Procurement Strategy & Planning

3 Must-Do Steps to Move Beyond Cost Savings

Spend Matters welcomes this sponsored article from Chuck Baren, Vice President of Professional Services, Americas, at SAP Fieldglass.

The days are gone when an external workforce management and services procurement program’s success was measured simply by the previous year’s cost reductions. The new table stakes are a tightly integrated procurement environment in which spend across categories and platforms can be used in real time to identify and rapidly adjust to market trends — all within the cloud.

ITC Finds TPP Will Have Positive Impacts on U.S. Economy and Industries

TPP

The Trans-Pacific Partnership will have a positive impact on U.S. businesses, workers and families, the U.S. International Trade Commission said in a report issued May 18. The nearly 800-page congressionally mandated report assesses the impacts the TPP would have on the U.S. economy, specific industries, employees and consumers. The ITC looked at the effects the TPP would have in 15 years on the economy, compared to a baseline economy without the TPP.

5 Actionable Strategies For Driving Social Collaboration in Procurement

social

We all hear about the rise of social collaboration in business beyond just posting our résumés on LinkedIn. Many of us are likely using at least a few social tools in our personal lives — Facebook, Instagram, Twitter, Snapchat. Even more are using social tools built on peer-to-peer and crowdsourcing-type models. For example, UberX or UberPool have become ubiquitous as crowdsourcing a method of getting from Point A to Point B using peers rather than professionals. Yet in business — and especially within procurement — social collaboration has been largely limited to the use of LinkedIn or rudimentary collaboration capabilities built into select procurement technologies.

Procurement Pros to Morph into ‘Business People’

Tradeshift

At Infosys Confluence 2016, I spoke on a panel titled “Reimagining the Procurement Value Chain” with procurement leaders Ben Moreno, from Stanford University, and Oscar Leon Chong, from Honeywell. The session was moderated by Gartner Managing Vice President Ruby Jivan. The conference, recently held in San Francisco, doubled in attendees over last year and featured a huge group of diverse partners, including Tradeshift.

3 Ways Large Buying Organizations Can Better Attract SMB Suppliers

change of control clauses

As procurement and supply chain organizations know, there are many benefits of working with small and medium-sized businesses — they diversify your supply chain, foster innovation, can often be more flexible, perhaps offer lower prices and a more intimate business relationships or even operate locally. But large buying organizations often struggle to effectively engage with SMB suppliers for various reasons.

Procurement’s Role as Master Architect: Design-Centered Procurement (Part 8)

design

As procurement organizations design tools and models to improve the process of supply management, they begin to create more idealized systems that can actually be implemented, bridging the gap between visionary “clean sheet” design and small, incremental redesign efforts relegated to narrow process silos. Yet there’s a more subtle and powerful effect in this effort. By focusing on constantly improving the design of the many inbound value chains in the enterprise, procurement begins to elevate its role beyond just strong, hands-on execution in delivering cost savings, but also towards a leadership position in intelligent design, transformation and enablement. These three attributes can seem like high-level words, but they’re important.

Outsourced Services: The Next Big Challenge

Spend Matters welcomes this sponsored article from John Dreyer, CEO of The Shelby Group.

In the delivery of complex outsourced services, there is often a disconnect between the prices negotiated during the procurement phase and the actual costs of what is delivered over the term of the contract.

Using the Design Process to Transform: Design-Centered Procurement (Part 7)

design

In the world of quality management, even well-designed products can only be manufactured by equally well-designed processes that are not just controlled but also capable. Such a process capability for manufactured items is formally engineered by a “manufacturing engineering” function that works collaboratively with design engineering on one side and operations on the other. So, it stands to reason that a procurement process for purchased items (and services) should similarly be engineered with upstream internal partners who specify the design and downstream with those involved with execution. This process of the design of procurement (i.e., the process of how to best engage external suppliers to maximize value) should be collaborative too.

Understanding Objectives, Trade-offs, and Constraints: Design-Centered Procurement (Part 6)

Design

In previous installments of this series, we talked about how good design applies not only to a product (or service) or the supply chain that produces it but also the design of the procurement operating model that is the architecture of the supply management services delivered in a procurement organization. In that design, we talked a little bit about reducing trade-offs between the diverse requirements and objectives of the many stakeholders, and the constraints placed on a solution that optimizes everyone’s needs. To do this, we should be fairly precise around the terms requirements, objectives, constraints and optimization. If you might notice, these are terms familiar in the parlance of bid optimization in strategic sourcing. So, let’s explore the learnings from that domain and apply them to designing an optimal procurement organization rather than an optimal sourcing event.

Designing The Procurement Operating Model: Design-Centered Procurement (Part 5)

platform ecosystems

In our previous installment of this series, we looked at design approaches for using software to help digitize procurement and the supply chain. But technology is only one aspect of a broader procurement operating model (or “service delivery model” if you prefer) that also includes process design, organization design, outsourcing, performance measurement, talent management and knowledge management, which is basically a combination of talent management and specialized automation. These have impacts on each other and can’t be designed in isolation. This area can seem abstract, so we’ll use a specific process area (sourcing) and some relevant examples to illustrate how a holistic design approach is important.

Infographic: Accomplishing Supply Chain Visibility Through MRO-as-a-Service

A few weeks ago, we published a four-part series focused on how maintenance, repair and operations (MRO) is a significant — yet often overlooked — business function in the supply chain. Authored by Michael Lamoureux, research analyst, and Pierre Mitchell, chief research officer, the series explores how this ignored category is abundant with possibilities for cost savings and overall supply chain improvements, especially when using a managed service provider model that works in the product supply chain in your approach.

Idealized Design: Design-Centered Procurement (Part 4)

idea

In our last installment of this series, we spelled out in great detail some the fundamental software “architectural” (aka design) changes that are happening with modern cloud-based software that is absorbing the emerging practices in B2C-focused software and services. But we didn’t spell out the benefits of such a componentized, platform-based architecture that uses true user-centered design principles that is also tailored to meeting the broader design requirements of the department, business unit, supply chain and enterprise. The problem is that as you broaden the scope, the more design conflicts arise, as design goals from different user groups conflict. But if you do it right, you’ll be able to reduce trade-offs and be able to more easily “mix and match” lower-level solution components and provision more flexible solutions