Tagged Content: L2

Survey Shows Value of Procurement Early Involvement

Clocks Spend Matters and the Institute for Supply Management recently teamed up to find out how well procurement and finance organizations work together. Specifically, one of the goals of the survey was to see the differences in savings when procurement was involved earlier in the supply negotiation and contract process versus when procurement was brought in later – maybe too late – in the process. The survey garnered more than 250 validated responses, and the responses showed a 2% savings difference between early involvement and late involvement. Over on our Chief Procurement Officer website, Spend Matters Chief Research Officer Pierre Mitchell dives into more detail on this finding in the article What’s the ROI of Earlier Spend Influence? Big.

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Exploring Investment Drivers for Global Supply Chain Risk Management

supply chain risk management AGCO’s story is fascinating – and will provide great business case fodder for manufacturers looking to build the case for investment themselves in such programs. But what are the business drivers for companies making investments in such programs today? At the core, companies are changing, silos are breaking down and stakeholders are collaborating 
as never before. As a result, a new concept is emerging: global supply chain risk management (SCRM).
 Quite often, the decisions to invest in SCRM are often driven more by the fear of negative press – and of course regulatory penalties – than the opportunity to make the supply chain more resilient and maintain top-line revenue and market share, even in the case of a supply chain upset.

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Spend Matters Analysis: Accenture’s “Virtual Company Mall”

Accenture analysis In Accenture’s most recent study on procurement, Procurement’s Next Frontier – The Future Will Give Rise to an Organization of One, the authors suggest the “virtual company mall” will provide the wrapper for the core of a firm’s shopping and tactical buying experience – i.e., how frontline users – and perhaps even procurement – shop for and purchase goods and services. It’s a clever thought to suggest that a single toolset – or more likely a single interface for users – will form the basis of a shopping system. It’s also clever to call it a mall, since within a mall, much like the future buying system the authors describe, there can be different branches or anchor stores as well as all of the individual merchants in smaller spaces that sell their wares. Yet for this analogy to work, a lot of elements need to come together.

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E-Invoicing Discovery Questions: Where to Begin

- July 29, 2015 8:07 AM | Categories: Finance, Invoicing, Technology

Question Mark in Money Putting in place an electronic invoicing program requires more than putting in place an e-invoicing system. Business drivers, supplier development programs, internal responsibilities, as-is/expected processes and process change and a range of other internal and external factors outside e-invoicing technology itself all should factor in the discovery process to create a set of requirements and needs specifications. In the Spend Matters paper Understanding How E-Invoicing Fits, I explore a list of questions that procurement and accounts payable (A/P) organizations should answer as a first step. Organizations interested in these types of questions will find the research brief, available temporarily for free download, quite valuable both in defining an optimal program and also in explaining to peers how e-invoicing fits with procurement, A/P, treasury, supply chain and related technologies and programs.

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Beyond Transactional P2P: Exploring Buy-Side and Sell-Side Trade Financing Techniques For Supplier Early Payment

- July 28, 2015 8:10 AM | Categories: Finance, Procurement Financials, Trade Financing

explore When it comes to the intersection of purchase-to-pay (P2P) and financing options, there is no shortage of available techniques to address early payment programs to suppliers. As David Gustin notes in the Trade Financing Matters research paper, Accelerating Early Payment: Techniques and Approaches for Accelerating Cash in the Supply Chain, these techniques can be generally segmented into buy-side and sell-side categories. Buy-side approaches suggested include: p-cards, dynamic discounting, static discounting and reverse factoring, 
commonly called supply chain finance. Further, “On the buy-side, large and mid-sized corporates want to optimize payment terms and maximize 
their working capital, while not punishing suppliers by making sure they have options to 
liquidate their receivables. Buy-side solutions require an approved invoice from the company to release cash.”

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Are SMEs the Weakest Supply Chain Risk Link?

risk Late last month, I took the same side as Stephen Allott, crown representative for small- and medium-sized enterprises (SMEs) at the UK Cabinet Office, in a pub debate in London, in which we argued for the motion that procurement is doomed for a variety of reasons, including the failure of many procurement organizations to effectively manage supply risk. Then, coincidentally, on the flight back to the US, I read an article in a UK publication reporting that a majority of SMEs are not prepared to manage supply risk. A curious coincidence? I’m not so sure.

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Friday Rant: Upstream and Downstream Without a Paddle

stream I'm not sure exactly when, but around a few years ago, terminology began to appear in the procurement technology provider community that labeled transactional purchase-to-pay (P2P) processes as “downstream” – meaning post-contract processes – and strategic sourcing processes as “upstream.” It has become a convenient shorthand naming convention – and also seemingly harmless. But, recently, I saw a provider trying to create some thought leadership about upstream value creation and downstream value capture and decided it was time to say something. Or a few things…

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Coupa Buys TripScanner – Extending Open Procurement Model To Travel

- July 23, 2015 6:12 AM | Categories: Industry News, M&A, Solution Providers, Technology

airport On July 20, the iconoclastic solutions provider Coupa announced it is acquiring TripScanner for an undisclosed amount. Like Coupa, TripScanner is built on an open network principle, except it is focused on business travel. Owing to its small size, TripScanner has not had any prior coverage on Spend Matters. But from what I have read about the company, its business concept appears similar to that of the travel portion of industry-leading travel and expense management provider Concur. Now part of SAP’s cloud portfolio, Concur’s approach lets travelers – in a user-friendly fashion – address their travel needs first and sort out policy consequences afterward. It’s a “spend-visibility-above-all” approach that aligns well with Coupa’s procure-to-pay (P2P) philosophy. Read on to find out how else TripScanner will bring value the Coupa's suite.

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July 30 Webinar: Forget Uber’s Classification Problems – Engage Critically Needed Independent Professionals, Safely and Efficiently

taxis Uber and other large-scale online work platform companies that engage large populations of workers in low-skill jobs have come under legal and regulatory fire as of late. Unfortunately, these businesses made big mistakes very early on: They did not take worker classification questions very seriously. But distinct from the media’s crisis coverage of Uber and other such businesses, the population of independent professionals, a critical enterprise talent pool, will continue to grow, as projected in a number of recent studies in the US and Europe. Sourcing and engaging this talent population will continue to rise as a priority for businesses and their contingent workforce procurement practitioners. Join us for a webinar, “Directly Source and Engage Highly-Skilled Independent Talent with Controlled Cost and Risk,” brought to you by Spend Matters and MBO Partners, in which you will learn about this fast growing independent professional workforce segment and state-of-the-art models for effectively and efficiently engaging these it.

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What Do Procurement Metrics and Procurement Analytics Have in Common?

abstract The clock is winding down to the Institute for Supply Management's Metrics and Analytics Symposium, which begins this Thursday in Philadelphia. (Register here.) Jason will be helping with a panel and I will probably be heading down as well. If you can, you should definitely try to make it. Craig Reed, who is an ISM board member and heavy hitter practitioner, will be leading it. I know Craig, and I can tell you he knows his stuff! Other executives from Honeywell and DuPont will also be at the event, as well as the non-manufacturing side, represented by Nationwide. You may wonder why there’s a conference on both metrics and analytics. Aren’t these 2 different topics? The former seems very organizational and the latter seems very technical. But the 2 are highly connected.

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20 Procurement Myths, Debunked 1-by-1

- July 20, 2015 6:34 AM | Categories: Procurement Commentary, Supplier Management

sport-alley-ball-game-large Pierre Mitchell has officially* wrapped up his procurement myth series over on Chief Procurement Officer. Pierre, our chief research officer, has knocked down 20 myths, one at a time, surrounding procurement, explaining why and how these theories came to be and why they are absolute rubbish. Check out the latest – and final – myth in the series, Supply Management is a Department: Procurement Myth No. 20. In this post, Pierre argues that procurement is more than just a single department within a company, separated from all the others with functions and values that only stay within said department.

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Exploring Payment Terms and Working Capital Optimization: History and Context

- July 17, 2015 8:10 AM | Categories: Accounts Payable, Finance, Trade Financing

Pay-Off Many outside of accounts payable and procurement fail to realize that most companies have not standardized their payment terms to suppliers. Or as my colleague David Gustin, of Trade Financing Matters, notes in his paper, Accelerating Early Payment: Techniques and Approaches for Accelerating Cash in the Supply Chain, “For most large corporates, there are no standard payment terms. Their payment terms vary across divisions, jurisdictions and through acquisition. Over time, a large company may have more than 50 different terms.” This proliferation of terms has become often low-hanging savings fruit for consultants that come in and look to identify opportunities, even inside more sophisticated accounts payable and procurement organizations. But to fully understand this trade financing terrain, a bit of history and context is necessary.

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