The Procurement Strategy & Planning Category

Tapping Your Most Underutilized Innovation Source: The Contingent Workforce

workforce

It’s no secret that talent is tougher to find these days. From skills deficits and low application levels to intense hiring competition between companies, contingent workforce managers know the search for the right candidates is fraught with challenges. No wonder, then, that one survey from the Society for Human Resource Management reported more than two-thirds of organizations hiring full-time staff are struggling to fill job openings. One result of this talent dearth, understandably, is that the lack of full-time talent translates into a reactionary need for contingent staff to fill the gaps. Scrambling to do this in a cost-effective and timely fashion, contingent workforce managers ultimately approach sourcing workers as a transactional activity.

From MABD to OTIF: Wal-Mart’s Latest Supply Chain Imperative

From must arrive by date (MABD) to on time in full (OTIF), Wal-Mart’s latest delivery standard is not just another supplier scoring metric. It’s actually a dynamic reporting mechanism that could become one of the best tools for measuring inventory flow ever conceived — at least, that’s what logistics experts and various consultancies with a compliance training interest are saying.

New Report: Obstacles in Advancing Marketing Procurement’s Strategic Value

marketing spend

There is still a case for marketing procurement, as a new report on the function’s obstacles and opportunities shows. Globality, which connects clients with small service providers, commissioned a survey of 300 senior procurement professionals from around the world. It gleaned eight major takeaways from the survey, which are presented in the report, Marketing Procurement 2017: Key Opportunities and Barriers in Advancing Procurement’s Business Impact. We’ll look at a few of these more closely.

3 Reasons the Cognitive Era is Not Yet Upon Us — But it Will Be Soon

Forget digital. The 2020s will be powered by super intelligent, human-like applications that all but replace their creators. This is the dawn of the cognitive era. At least, that’s what the software market has been saying for the past year or so. But given that most organizations, particularly those in a B2B or supply chain context, have barely come around to adopting even plain old “digital” strategies, cognitive’s penetration in the enterprise is, perhaps, a bit oversold. To understand why, here are three examples of how we're still laying the groundwork for the transition from digital to cognitive — and what to expect when it really starts.

How to Decide on Organizational Sourcing Structures, Supply Market Intelligence Sources (ICYMI)

category management

Last week, we ran two stories that have come out of our new feature, Ask Spend Matters. The feature asks readers to tell us what they’ve always wondered about procurement and supply chain, and our editors then select questions to pursue and investigate. While our first replies covered the intricacies of tail spend management and the use of big data in public procurement, last week we tackled two questions related to the sourcing side of procurement. Check out what your peers are wondering and be sure to leave us your own question!

A New Spend Metric: “Touched Spend” — Do We Need It?

AnyData Solutions

One of our Spend Matters Plus clients, a procurement manager in the energy sector, sent me a note asking about a new benchmarking metric that he recently saw being collected by CAPS research called “touched spend.” He sent me the following definitions below and asked me to weigh in on them, given my tenure at The Hackett Group running procurement research related to benchmarking, for sourceable spend, managed spend and also "touched" spend.

Building Supply Market Intelligence: Which Data Sources are the Best?

Often, it’s all about how quickly one can digest something. No, I’m not talking about Joey Chestnut’s eating-champ prowess. I’m talking about market intelligence. In a procurement professional’s day-to-day, that sentiment has certainly become more widespread than ever. In fact, with time at a premium, the majority of procurement pros — from junior buyers all the way up to CPOs — are faced with this issue every day. However, it can pay dividends to approach supply market intelligence in a strategic way.

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The Procurement Process and Contract Management: The Key to Managing Risk

It’s no secret. Organizations are losing millions due to cost volatility, supply disruption and non-compliance fines. An ever-increasing pace of business and rising levels of uncertainty within our global economy have brought about an alarming amount of potential pitfalls for procurement leaders. This means risk management has been more of a top priority than ever, and procurement is on the front line of managing that risk. The good news is procurement has a secret weapon: contracts.

Centralized, Decentralized or Hybrid Sourcing Structure: How Do We Decide?

Today’s Ask Spend Matters question came from Piyush Shah, a PhD student of supply chain management at Arizona State University: “Centralized, decentralized or hybrid sourcing structure? How do we decide?” This is a classic question and one that has sparked decades of passionate debate. Proponents of centralization point to the potential for higher savings. Defenders of decentralization argue that regional procurement teams can bring about better supplier relationships.

The easy answer is “It depends” or “A hybrid of the two.” But what does a hybrid structure look like? And how do factors like purchasing category, industry and stakeholders play into the assessment?

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New Ways to Achieve Unprecedented Savings on Indirect Spend

In Deloitte’s 2016 Global CPO Survey 2016 report, 74% of respondents stated cost reduction as their top priority in 2017. Also, 70% of the surveyed procurement executives cited indirect spend as a top focus for controlling and reducing costs. Recent studies have found that indirect spend can account for up to 50% of a company’s purchases, and manufacturers specifically can spend 20% or more of their total revenue on indirect expenditures. It is clear the next profound impact area for procurement professionals is in accessing hidden and unexploited areas of indirect spend.

ICYMI: What Have You Always Wondered About Procurement (But Were Afraid to Ask)?

The Spend Matters editors have been busy working through reader questions these past two weeks. Our recent submissions run the gamut from how to implement supplier relationship management to what professional skills will be most in demand in the supply chain and procurement field to, er, prank questions from our own colleagues. You might be thinking, “But hang on! What’s all this? Can I submit a question? Is this a new feature?” Yes and yes! In case you missed it (this is peak vacation time, after all), earlier this month we launched Ask Spend Matters, where you tell us what procurement questions to investigate, and we report out the answer in the form of an article.

What’s the Cost of Having a Long Supply Tail, and How Do You Determine the ‘Right’ Supply Base?

tail

We recently put up an interactive Ask Spend Matters box so that you, our readers, can tell us about the topics you want us to investigate. One of the first questions that came in was about tail spend: “What is the cost of having a long supply tail, and how are organizations determining the ‘right’ supply base (number and percentage) as relates to spend?” As Spend Matters Chief Research Officer Pierre Mitchell put it, "This is a great question, but it’s a bit tricky to answer.” Read on to hear his reply!