New Spend Matters Paper – the future of sourcing in the manufacturing sector

There's a new research paper available from the Spend Matters family that will be of interest to anyone involved in the manufacturing sector. There's more detail on our US site but I'll summarise here:

MetalMiner (our sister website) and Spend Matters US are excited to announce the launch of a combined research study, Manufacturing and Direct Materials Sourcing: A Planning Guide for the Next Decade. Authored by Jason Busch and Lisa Reisman, this Spend Matters/MetalMiner Perspective explores crucial elements of the skills, core technology and expertise that procurement and supply chain practitioners will need to operate in the global manufacturing environment in the decade ahead.

As global manufacturing uncertainty continues into the second half of 2012, we still find ourselves (for the most part) largely mired in direct materials sourcing and procurement technologies of the past decade in manufacturing environments.

Far too many organizations continue to struggle with driving adoption of SAP and Oracle eProcurement implementations and few have turned their consistent attention to a new wave of tools designed specifically to enable the types of direct materials procurement and supplier management capabilities that can bridge the gap between traditional purchasing and supply chain functions.

Here at Spend Matters and MetalMiner, we believe the next decade is going to be one where leading manufacturing organizations (from diversified industrial manufacturers to consumer packaged goods companies) will differentiate themselves not just by introducing the right talent into the procurement function -- a major goal of the past decade -- but also in how they build capabilities and practices around automated technology that transforms the way they forecast, negotiate, bring new products to market and manage extended tiers of suppliers.

... From wage inflation in countries like China to broader total cost increases, it's become clear that managing total cost is just as important as managing quality and performance of suppliers in low cost or developing markets.

As we consider popular tactics and investments among leading manufacturers, Spend Matters and MetalMiner see five key areas and programs that procurement organizations are beginning to focus on, often in tandem, which will form the basis of broader strategies in the next decade. These are:

  • Enhanced Forecasting and Planning
  • Smarter Negotiation Tactics
  • Total Cost Visibility DNA
  • Extended Supplier Management and Orchestration
  • Developing the Right Core Capabilities to Think Globally While Acting Locally

Taking just one of these areas explored in the paper, Smarter Negotiation Tactics...  Our strong belief is that electronic negotiation formats are here to stay, but on an increasing basis, leading manufacturers are beginning to factor a total cost understanding into sourcing strategies that consider not only their idealized specifications, but also variability in supplier offers based on specific advantages amongst competitive vendors and potentially lower tier suppliers.

There's a whole lot more in this "Perspectives" paper, and you  can register to download it and related research on our Spend Matters PRO site. Spend Matters Perspectives are available for free for qualified practitioners that register for access to our PRO Research Library (note, the Research Library does not provide access to daily PRO Premium Content).

Both practitioners and providers (e.g., those that work for vendors, software companies, consultancies, BPO, etc.) can sign up for immediate access to our entire Research Library and Premium content by purchasing a Spend Matters PRO Core subscription. Practitioners also have the option of purchasing a PRO Basic subscription (which provides access to Premium Content) or can simply opt to access our Research Library (both upon qualification). Please note,  practitioners who work for organizations we classify as providers must purchase a PRO Core subscription (or corporate agreement) for access.

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