Spend Matters Papers: Market-Informed Sourcing; A game-changer for Procurement

So here’s the plan - through August we’re going to highlight all the research papers, briefings and so on that we’ve produced in the last two and a half years. We’ll  include what we said when we first launched it, and of course the link so you can download – free on registration. Why not use the quiet time in August to brush up on some procurement thinking?  And they haven’t dated, in our opinion.

 Today we have “Market-Informed Sourcing; A game-changer for Procurement”.

Here’s what we said when we launched it back in October 2011.

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If you’ve been reading Spend Matters for a while, you’ll know that the topic of “optimisation”, advanced sourcing, (insert your favourite terminology here) has come up regularly. That’s not purely because we feature the world’s leading solution providers in this area amongst our sponsors, true though that is.

It’s more we firmly believe that:

a. The latest technology opens up some very interesting and valuable opportunities to procurement professionals and their organisations and

b. Those opportunities are not in general well understood or used yet by the profession.

We wrote about these issues and explained what we perceive as the role of optimisation in our previous White Paper.

And now, we have another White Paper which is being launched this week, and will be free to download, sponsored by our friends at BravoSolution. It's called " Market-Informed Sourcing: A game-changer for Procurement". (Available here for download).

In it, we take those discussions on further. In particular, we’re putting our head on the block by suggesting that the opportunities opened up by the latest technology actually change how procurement needs to look at one of our most fundamental processes and methodologies  that of Category Management.

We’re not suggesting that “category management is dead” although we did consider that as a headline grabbing title! We might still be tempted to go for the tabloid type approach. That’s not really what we’re saying, but we believe that for many categories, we need a fundamentally different approach to the strategic procurement process. The platforms available now will enable this, and will deliver significantly better value than current approaches.

We’re also making a bold suggestion. One of the reasons that uptake of this technology has been slower than it should be is, we feel, confusion about the terminology.  “Optimisation” sounds a bit mathematical and obtuse.  And every provider has a different term, and while this may help them distinguish their offerings, it leads to confusion in practitioners’ eyes.  So from now on, including in this paper, we’re going to be calling this process and family of technology solutions “market-informed sourcing” – or MIS for short.

That seems, after some considerable thought, the most appropriate description.  (We’ll explain why next week).  Category Management has always had the benefit of a simple, fairly snappy title that everybody (consultants, practitioners etc) uses and understands. We think that having the same commonality for this process will help to drive adoption and use.

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