This PRO brief proposes that an organizational shift is taking place from (a) enterprises that source and consume a very limited set of labor/talent resources (contingent workforce) through certain processes and technology solutions to (b) enterprises that are advancing to another stage (extended workforce) in which a broader array of labor/talent-based services can be accessed by internal business consumers. Some of the pieces of the extended workforce ecosystem are already present, but major gaps in technology and processes must be filled, and procurement must become interested in moving beyond its limited contingent workforce view and take an interest in making extended workforce a reality for their businesses.
Category Archives: Procurement Strategy & Planning
Crowdsourcing is a word that almost everyone has heard, but few know the meaning of it. It doesn’t help that the meaning is quite fuzzy around the edges and is still evolving even among those that practice it. Yet when brought into sharper focus and spelled out in the context of services procurement, just exactly why crowdsourcing is of importance to enterprises and service and contingent workforce buyers should become more clear. If ever there was a case for procurement to get smart on a topic fast, this is it. This Spend Matters Plus research brief defines crowdsourcing and explores contingent and services procurement examples. It also outlines why we should all pay more attention to crowdsourcing and how best to educate our teams about how to take advantage of it.
Spend Matters welcomes this guest article by Joel Johnson of GEP.
Manufacturing companies, particularly those in commodity industries, are continually seeking step-change cost reduction strategies. The standard procurement contribution of 5%-10% savings from an RFP or supplier negotiation is often deficient in the face of more aggressive targets. Such conditions have led to close scrutiny of plant fixed costs, of which maintenance supplies and services are a major contributor. This has left both plant leadership and procurement teams with the question, “Can an area as operationally critical as maintenance be an opportunity for major cost reductions?” The answer is almost always yes. A few simple questions can help point us in that direction.
Adopting a Perfect Order Metric: Considerations, Tips and Benefits For Your Procurement Organization
Over on our sister site, Chief Procurement Officer, I have been discussing the perfect order measurement and how to adopt the metric for your procurement organization. While the perfect order metric may sound simple, the implementation can be complex. This Spend Matters Plus article will focus on how to address and overcome this complexity, as well as how to implement the perfect order effectively. I also touch on the benefits of perfect order, including how it enables better measurement of supply chain performance. If you want to measure perfect order performance, you have to ask yourself a lot of questions. Here are 5 key questions to ask and adapt to your organization regarding the perfect order metric.
We continue our Spend Matters Plus series on contract lifecycle management (CLM) today with Part 7. So far, we have covered a lot of ground, explaining what CLM is (a decidedly unsexy acronym that, when properly implemented, can generate quite attractive results on its own, and even more when integrated into broader buy-side and enterprise-wide processes), discussed the CLM framework and talked about which solutions are required to support the full CLM process from an end-to-end procurement perspective.We have also covered what we believe to be “must-have” capabilities and “should-have” features of any CLM solution. Here we conclude our in-depth review of contract management solutions with a discussion of supporting “nice-to-have” capabilities that, while not present in all or even most solutions, can greatly increase the power, usefulness and even the value of such a solution to your organization.
Spend Matters recently held a joint webinar with GEP on how to successfully implement a procure-to-pay solution and how to keep the process from turning into a nightmare. This 2-part Spend Matters PRO series lays out what tips we suggested for procurement organizations embarking on a P2P project. This is not meant to be an all-inclusive, step-by-step implementation guide, however. We simply want to share our best practice ideas based on our experience and our discussion in the webinar. Today, we will focus specifically on project management as a procurement responsibility, as well as ensuring finance and accounts payable are included in the P2P implementation project. Other areas we will cover are remembering the importance of supplier integration, system testing and user training in the P2P process.
Prodigo and Healthcare – Customer Case Studies and Applying Lessons Learned to Cross-Industry Procurement
Prodigo, a procure-to-pay (P2P) technology specialist in the healthcare market, has a lot to offer procurement organizations. We began our discussion on the provider in Part 1 of this multi-part Spend Matters PRO research brief. Today, we share stories from Prodigo customers who we have had a chance to speak to and who are supporting highly complex transactional procurement environments. These customers have confirmed the complexity of the environments that our briefings and demonstrations here at Spend matters have suggested. For example, one customer has seen all internal item master information become part of the Prodigo catalog. But the Prodigo system is also used to index and manage external information for direct purchases from manufacturers (enriched with third-party data as well) because the internal item master doesn't carry all the items or the information necessary to make frontline decisions. This may sound simple, but the use case and complexity is surprising indeed to provide complete buying transparency and control – and bring a range of lessons learned for non-healthcare procurement organizations as well.
Standardizing the Research and Delivery Process: Building a Procurement Market Intelligence Center of Excellence
Building a procurement market intelligence center of excellence (CoE) requires more than just hiring the right analyst resources and experts. It also requires a dedicated research model and approach. In the first installment of this series, we covered many of the core elements of functional definition and skills required for success among team members when considering how to build a market intelligence center of excellence. Today, we turn our attention to the market intelligence and research delivery process. And if you're looking for metrics to measure and guide a procurement CoE – in market intelligence efforts and beyond – be sure to take the ISM/Spend Matters snap poll on supply management metrics.
Spend Matters welcomes this guest article by Sanyam Khurana of GEP.
We have all heard that famous proverb, but when seen in the context of procurement, my slightly tweaked version still holds true. Classic examples are when hard times hit – a war, a depression or recession, crisis or just a tough period due to wrong decisions – it is the mighty who succeed with their hard work and perseverance. In my experience, procurement is perhaps a function that is seldom heard diligently or given a seat in the executive board. More often than not it is directed to do something, and like a sincere employee, it listens, executes and performs.
A recent paper, Procurement’s Next Frontier – The Future Will Give Rise to an Organization of One, explores the future role of the procurement function, including duties, charter and what it will need to leverage and deliver to meet expectations. One of the 5 areas Accenture says will define the future of procurement technology is a concept it terms the “virtual supplier room.” A critical component of the virtually integrated enterprise, this room will, “enable the company to virtually interact with strategic suppliers to share insights and ideas, as well as collaborate on innovation programs via common social media methods. It will also provide uncharted suppliers with an avenue to collaborate with the company on possible future innovations.”
Occasionally, a procurement technique or solution approach we see in healthcare potentially brings broad applicability to other sectors as well. We’ve learned over many years that most solutions in this market are highly bespoke given all the challenges associated with managing complex (and specialized) product information, physician preference items, billing and reimbursement and attributes unique to hospital and clinician environments. But a recent set of briefings, demonstrations and customer reference discussions with Prodigo Solutions, a procure-to-pay (P2P) technology specialist in the healthcare market segment, suggest a range of lessons from healthcare environments that we can apply to more generalized purchasing environments. This 2-part Spend Matters PRO research brief explores Prodigo’s capabilities, the customer experience and what procurement can learn from healthcare.
Market intelligence should be a core competency of procurement organizations. Yet far too many companies and public sector organizations either leave market intelligence to individual buyers and category managers to manage informally or outsource aspects of the function to a third party without sufficient internal understanding or investment to leverage the information that comes back. Last week, at the Institute for Supply Management’s Metrics and Analytics Symposium in Philadelphia, Grace Zacharek, DuPont’s global market intelligence team leader, gave a great talk on all the steps involved in building a global market intelligence function for procurement. No doubt some of her advice is best aimed at larger companies, but much of it is extensible even to larger middle market companies that want to develop a proactive understanding to drive market intelligence centered on suppliers, supply markets and categories.