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.
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This fall, Spend Matters is conducting a survey of overall vendor management system (VMS) pricing trends in the market. But in the meantime, we thought it would be useful to share a joint perspective with an industry expert specifically around VMS and managed services provider (MSP) pricing and business model trends for supporting statement of work (SOW) programs. As SOWs become a larger percentage of typical services procurement expenditure in more mature procurement organizations — and as specialized technology and managed services offering continue to develop to support these programs on an end-to-end lifecycle basis — it is becoming increasingly important to think about managing these efforts in a dedicated manner. This Spend Matters PRO analysis provides insight into how procurement organizations can more effectively engage VMS and MSP providers in support of their requirements based on current pricing and business model trends,including supplier-funded models.
Spend Matters welcomes this guest post from Kanita Brown, managing partner at KH Brown Solutions. One of the challenges for the contingent workforce management professional in demonstrating value from your program is having your cost savings recognized by your organization. As procurement, you know that it can’t be all about warm and fuzzy things like risk mitigation and compliance — ultimately you are measured by how much money you save.
Few would disagree that the professional services industry is mature — business and delivery models and the actual industry structure have remained practically unchanged for decades now. This industry is not only mature but also massive and complex.
A long state of industry maturity is almost always a predictor of an approaching period of significant change — disruptive, transformative and most often both. As in other industries, technology and online platforms are already making their mark — and will do so increasingly.
If you are an enterprise contingent workforce or services procurement practitioner, it’s almost certain that you have some awareness of the increasing role of state-of-the-art technology platforms in intermediating contingent work arrangements. You know today (whether because of Uber, or Upwork, or others) that technology-based platforms are being used to engage contingent workers, get work done and most often pay the workers — all through a single digital platform. But this awareness was not always the case. When analyst coverage of this subject started over four years ago, the emergence of work intermediation platforms was (for all intents and purposes) off the radar of practitioners, who were absorbed with program expansion, vendor management system (VMS) adoption, staff-augmentation cost and risk management and the increasing need to manage SOWs. All of these remain top priorities now, but practitioner mindshare has opened up for several reasons, such as the need to access and engage skilled talent in a time of shortages and the expanding popular awareness of freelance, gig and on-demand.
DCR Workforce: Vendor Snapshot (Part 1) — Industry Context, Business Background and Solution Overview [PRO]
This Spend Matters PRO vendor research series focuses on DCR Workforce (DCR), a provider of services management/procurement technology solutions. DCR Workforce is a difficult provider to paint into a box. On one level, DCR provides a next generation vendor management system (VMS) solution, more than capable of holding its own against some of the better known providers in the sector on a functional basis addressing basic contingent workforce requirements. But on another level, it delivers much more — a statement of work (SOW) capability that is fundamentally different than other VMS providers in approach and capability, a powerful analytics platform for managing broader services procurement activities and even a freelancer management system (FMS) and supplier network that offers new ways to manage freelancer and contractors. Part 1 of this series provides background and the business context surrounding DCR Workforce, including quick facts and a history of the provider, and an overview of the DCR business and solution set. Subsequent parts of the series will go deeper into the DCR solutions and what use cases they may best address.
Services procurement, with the exception of contingent workforce management (CWM), has evolved imperceptibly over the past 15 years. However, there are reasons to believe that it is about to change — or in terms of what procurement does, will need to change. Those reasons include the pressure to reduce cost of services and the effects of accelerating digitization. Still, without senior management support, additional funding and organizational development, the need to change may not be addressed, leaving gaps in enterprise performance, which more proactive, competitive companies could exploit.
In this first part of this PRO series, we will cover “The What” of services procurement — where we’ve gotten to today and where we seem to be heading. In subsequent installments, we will focus on the role of digitization and what changes procurement will be addressing as consumption and buying of services in different forms increases across enterprise organizations.
This week we present blur Group PLC as the WIP of the Week. From our standpoint, blur is an online marketplace work intermediation platform with a service layer consisting of supplier vetting and some customer support. What seems to set blur apart from other online marketplace WIPs is that its supply base consists of service provider businesses — 67,000, it says, “from boutique marketing agencies to multinational consultancy,” including companies like Ogilvy, WPP, Accenture, KPMG and others. As such, blur positions itself as a services marketplace platform versus a freelance marketplace platform, offering value propositions for procurement such as services tail spend capture, a services catalog, spend visibility and cost savings. In this brief, we provide an overview of blur, its unique platform model and, as usual, offer our own commentary.
Wonolo: WIP of the Week [PRO]
This week we present Wonolo as the WIP of the Week. The company provides an on-demand work intermediation platform that matches and connects businesses and pre-vetted, local workers (Wonoloers) who can rapidly fill short-term jobs. The platform also enables the online payments from businesses to workers and provides other capabilities to both businesses and workers. Platform-intermediated, on-demand “gig” work arrangements (requested and fulfilled locally) are now mainstream (rides, deliveries, errands, short tasks, et al.). Unlike many of the on-demand labor marketplaces that focus on serving consumers and/or very small businesses, Wonolo targets both SMB (over 30 employees) and large enterprises (over 500 employees) that have unpredictable, short-term, uniform-output labor requirements. Moreover, Wonolo can meet business needs for multiple workers (for example, 20 warehouse workers), not just one-offs. It tends to enter into longer-term fee agreements with businesses, though businesses can also engage Wonoloers “by the drink,” as it were. In this brief, we provide an overview of Wonolo and its unique platform model and, as usual, offer our own commentary.
This week we present UpCounsel as the WIP of the Week. The company provides a specialized legal services marketplace platform that enables connecting clients with attorneys and supports the delivery of a specific legal service (attorney to client) along with billing and payment.
Services procurement category managers know that spend on outside legal services is a significant and complex spend category, and they have worked hard over the years to reduce it. Are procurement’s efforts to continue to push down outside legal services costs petering out? Or are there options ahead? And could they be dependent on technology?
In the PRO brief, “The Digital Evolution of the Contingent Workforce Supply Chain: A Simple Typology for Work Intermediation Platforms (Part 2B),” we developed a framework that defined WIPs in terms of three basic categories (marketplaces, service providers, private pools/networks) with further differentiation based on a few key attributes. We also unpacked/discussed these three basic categories and their variants in detail (if you have not read the brief, reading it will provide helpful background). However, this discussion was somewhat abstract, so in this brief we present and discuss a number of example WIPs that we would assign to one of the three categories — noting once again that some WIPs could be represented in more than one category.