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Digital Transformation Drives Top Procurement Operations, And Can Help Late Adopters, Report Finds

World-class procurement organizations have achieved enormous advantages through automation and the adoption of technology solutions, according to a new report on digital transformation from the Hackett Group.

The 2018 benchmarking report found that top performers, thanks to their digital transformations, have 21% lower labor costs and 29% fewer full-time equivalent staff than more typical organizations. For this reason, the authors of the report proclaim that procurement is now at an inflection point: While technology has always been effective at helping procurement increase efficiency, “world-class organizations can continue to reduce costs by embracing digital technology, while the peer group can leverage the same technology to catch up faster at less cost.”

Find out how the top performers do it and how late adopters can catch up.

Manufacturing Skills Shortage Creates Challenges, Opportunities for Digital Transformation

Toyota supply chain

Manufacturing has a shortage of skilled workers, and year by year it is expected to grow to about 2.2 million unfilled jobs over the next decade, according to a study that has been tracking the gap for almost two decades. The shortfall in workers who can handle the technical nature of manufacturing and its digital transformation could cost the U.S. economy $2.5 trillion over the next 10 years, says the 2018 study by Deloitte and the Manufacturing Institute. As one manufacturing executive said in the study, “With the positive turn in the economy, we don’t have enough job candidates with the right skills and work ethic to fill our openings, and this is making it difficult for us to accept the orders our vendors are asking us to complete.” Find out how companies are trying to bridge the gap.

Year-end ‘Dash for Cash’ — 7 Steps to Free Up Funds Without Resorting to Tricks

It’s the end of the year, time for New Year’s Resolutions, a little vacation time and Christmas Party hijinks. But the Hackett Group, a business consultant and digital transformation specialist, is cautioning against year-end fiscal shenanigans, where money is shuffled around to make it appear that the company has hit the finish line in full stride. A new paper from the group lamenting the yearly “dash for cash” argues that you can look for sustainable, healthy ways of freeing up cash at the end of the year without pulling any three-card-monty tricks. According to the paper on working capital, many companies think it’s too late at the end of a quarter or year to free up significant cash. But it suggests 7 steps you can still use.

Commodities Roundup: G20 Outcomes, Century Aluminum Expands and DRC Raises Cobalt Royalty Rate

Global Risk Management Solutions (GRMS)

For the buyers and category managers out there, especially those of you deep in the weeds of buying and managing commodities, here’s a quick rundown of news and thoughts from particular commodity markets. From price movements to policy decisions, we scour the landscape for what matters. This week we look at developments from the G20 summit, like the USMCA signing and the U.S.-China tariff truce; Century Aluminum expanding capacity; Rio Tinto's first bauxite haul in Australia; auto sales flagging and more.

T&E Benchmarks: How Does Your Company’s Technology Compare on Handling Travel & Expense Reporting?

Oversight Systems

Companies in the U.S. spend hundreds of billions of dollars annually on travel and entertainment — and a study from Certify Inc., an expense report software company, surveyed executives and finance leaders to get a snapshot of how many still use manual methods versus how many have upgraded their T&E management technology. In the study, officials note that travel and entertainment costs can be a significant part of companies’ budgets, which means efficiently managing employees’ expense reports can greatly affect a company’s profits. Since 2013, the “Expense Management Trends Report: Annual T&E Outlook and Benchmarks” by Certify has worked to help companies of various sizes recognize best practices to consider in travel and entertainment reporting and as methods to benchmark such companies’ current processes against their peers.

SolutionMap: 58 Procurement Software Companies Ranked (Q4 2018 Update)

Spend Matters today released its Q4 2018 SolutionMap, ranking 58 procurement software companies across 12 solution categories, including E-Procurement, Sourcing, Spend Analytics, Supplier Relationship Management and Contract Lifecycle Management — and we're adding Coupa, Wax Digital and other new providers to the SolutionMap ranks. Click on this article to see how to access rankings for free!

Join the Coupa Webinar Tomorrow to Learn About Community Intelligence

Spend Matters UK’s procurement veteran Peter Smith on Tuesday will join Coupa’s John Callan for a webinar in the UK about developments in community intelligence, the idea of driving benefits through a community of organizations that are each buying separately but look to collaborate in some way.

Leading procurement/spend management firm Coupa is hosting tomorrow’s event, “Community Intelligence — A Procurement Revolution.” The time of the webinar was changed to accommodate the North American audience, so sign up here and join the 45-minute session at 9 a.m. Central time (3 p.m. UK time), and bring your questions about community intelligence.

“Advances in technology, driven by firms like Coupa, are increasing the potential for benefits from it, making it a significant tool for procurement and one which we believe procurement leaders need to understand,” Smith says in a preview of the event.

Commodities Roundup: Falling Oil Price, Steel Production and G20

oil oversupply OPEC

For the buyers and category managers out there, especially those of you deep in the weeds of buying and managing commodities, here’s a quick rundown of news and thoughts from particular commodity markets. From price movements to policy decisions, we scour the landscape for what matters. This week: Price of oil is falling, updates on steel production and imports, G20 Summit begins today, and is GM leading the way on downsizing?

Interview with Malcolm Harrison, CIPS New CEO (Part 2 — Growth, Change and the U.S.)

Spend Matters UK's interview with new CIPS leader Malcolm Harrison continues with a focus on the professional organization's short-term and long-term plans.

"We must remain relevant to the UK," Harrison says, "but many organizations who employ our members are very interested in what CIPS can do outside the UK — we were invited into the U.S., for example."

Harrison also digs into the institute's strategy to serve its core membership in the UK while also making tough decisions about leadership that can help it expand in other countries. For example, the Chartered Institute of Procurement & Supply recently decided to not appoint a new president when the previous term expired. 

"As we get more international and diverse, it is hard to see that one person can fulfill all the needs," Harrison says.

Procurement veteran Peter Smith, of Spend Matters UK, recently sat down with Harrison to catch up on his first 100 days or so in office.

In Part 1, the interview looked at CIPS' commercial focus. This installment of the three-part series focuses on the future.

"You know the saying 'a tree is either growing or dying' — there is no steady state," Harrison says. "I feel that way about CIPS, we have to move forward and change."

Making It Real: Workforce Agility in Context

talent management

Organizations are increasingly being driven by market and competitive demands, new technology and other environmental factors to become more responsive to rapidly changing opportunities, challenges and threats — to become, in effect, more agile. The question of specifically how an organization can become agile is still being answered by executives, management consulting firms, framework creators and academic researchers. But what we do know is that how human capabilities are engaged, organized and used is a big part of the answer to the question. In this brief, we explore how workforce agility is connected to organizational agility, where most organizations actually are on the road to organizational agility and why the drive to agility is both urgent and incremental.

Gary Hare Talks Amazon Business and Turning the Internet into the ‘World’s Largest Supplier Network’ (Part 2)

“I think the market is going to move from being buyer-centric ... to supplier-centric. [Suppliers] need help going digital,” says procurement veteran Gary Hare. “We really have no choice if we want to get this right.”

Hare’s assessment came during a discussion about Coupa’s purchase of Aquiire and the future of e-procurement shopping, which he says involves a way of outworking Amazon Business and turning the internet into "the world’s largest supplier network." He knows the issues because until 2009 he led Vinimaya before it rebranded as Aquiire. Hare, now the CEO of Vurbis USA, talks about the future of e-procurement in Part 2 of this Q&A, which has been edited. Part 1 ran Monday.

Top Posts of Fall 2018: Market Consolidation, Conference Season and Intensifying Trade Tensions

Procurement

As students went back to school and businesses shook off the haze of a sultry summer, the procurement world kicked off fall with bang. Leaving little time to reorient after Labor Day, we saw major acquisitions in several sectors of the procurement software market, along with new insights from the fall conference circuit and continuing developments in the tense global trade environment.

Take some time this Thanksgiving weekend to catch up on our most-read coverage from Fall 2018 and prepare for the end of the year with the latest news and research on Spend Matters PRO and SolutionMap Insider.