Procurement News from the US – Weekly Round-Up

Jason, Thomas Kase and I all attended Coupa’s “Crank the Savings World Tour” yesterday in Chicago, featuring a company overview and a customer testimonial (McDonald’s) as well as Jason and Thomas participating in an “Ask the Analyst” session. I didn’t win the drawing for an iPad 3, to my dismay, but the coffee was delicious and Jason and Thomas fielded a number of great audience questions around where supplier networks are headed (ask Jason about his “dark horse” theory) and the current status of BPO.

Anyway, here’s what happened on Spend Matters US this week:

We continued to look at Ariba’s quarterly earnings call.

Ariba's Quarter: Digging for Insight in the Numbers and Earnings Call (Part 2) On its most recent quarterly conference call with investors, Ariba shared the most public insight into the dimensions of its new partnering face that we've seen articulated to date. Of course there are always multiple elements to successful partnering, and oftentimes the worlds of vision and strategy end up being detached from successful execution. Still, Ariba clearly has a solid working vision here in engaging the broader software and services ecosystem that touches on procurement, financials and related areas. (See Part 1 and Part 3 too).

Jason discusses the findings of a recent study.

The Small Manufacturer Perspective: Comparing Re-shoring Trends in the US and Europe -- recently surveyed US and European smaller manufacturing suppliers (typically "job shops"), and the findings in terms of re-shoring from March/April 2012 might be a surprise to some. Without question, it seems that North American suppliers in the manufacturing sector, at the least at the lower end of the revenue spectrum, are benefiting disproportionately from re-shoring efforts by their customers. In Europe, only 23.4% of respondents (out of a sample size of 154 in the study) suggested that their "company benefited this year from work that has been re-shored," which is defined as work that was previously sourced to a supplier in another country. In the US, the findings are inverted, with 40% of suppliers responding in the affirmative to benefiting from re-shoring initiatives. Put another way, the US number was 70% higher, a not-so-insignificant difference.

Amazon is just on a roll lately. Regular guest contributor Jeff Muscarella asks:

Will You Rent Your Enterprise Software from Amazon? -- Will Amazon's move into enterprise software change the dynamics of SaaS purchasing? Perhaps. There is a good chance that this will drive less pricing transparency, not more. It could also lead to the rise of a non-negotiable, one-size-fits-all purchasing environment. IT sourcing departments need to carefully factor in the obvious and hidden switching and implementation costs that are part of that "easy" buy.

I love top ten lists -- this one’s from a webinar Jason did.

10 Strategies Beyond the Basics to Enhance Procurement’s Value -- The topic of my talk will focus on strategies for going beyond the basics to enhance procurement's value. Given the current market environment, I will preface my arguments with the need to think beyond just the basics to deliver value to the business. Further, improving procurement's value to the business requires embracing new sourcing-related tools (contract management, supplier management, etc.) wrapped around basic strategic sourcing activity and services spend knowledge to engage the business and drive additional savings. There are ten ways (outside of transaction-related focus areas) that we see to deliver this new value. A number of these will be old hat for frequent Spend Matters readers. But hopefully I'll touch on a few which most organizations are not pursuing yet.

- Sheena Moore


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