Procurement news from the US — Weekly Round-Up

Everybody seems to get very excited about “top tips” posts:

Top Tips: Indirect Procurement/Sourcing as a Spend Management Core Strategy Component (Part 1) -- Over on Procurement Leaders Blog, Paul Teague recently commented and gave some examples about how procurement organizations with proven indirect sourcing teams and focus areas have done a 180 away from the Rodney Dangerfield's "I don't get no respect" buying reputation. Citing examples in the marketing (agency of record) area, for example, Paul suggests that with indirect (as with direct), "you have to get into the shoes of the suppliers before you put your foot down on what might be unreasonable demands" when it comes to managing categories successfully.

Are we facing a critical skills gap?

Supply Chain Talking Points: The Mindset of Procurement and Supply Chain Teams --Bob Ferrari (author of Supply Chain Matters), who I had the pleasure of catching up with at SAP Sapphire this spring, recently authored a guest post for Infosys that captured a number of his observations on top of mind topics for supply chain and procurement executives this spring. While it would be useful to memorize all of his observations to supplement polite cocktail conversation this summer, a number represent precisely the areas the two of us -- and many others -- have been harping on for the past few quarters. Yet Bob also defies convention with at least one observation that is less frequently talked about -- definitely worth exploring in more detail.

An interesting question with several comments. Join the debate!

Will Big Buyers and Accounts Payable (AP) Organizations Embrace Free E-Invoicing? -- Tradeshift, an upstart electronic invoicing provider that delivers a free electronic invoicing service (and in the future plans to earn revenue off of offering additional services such as discounting/financing on top of its invoicing and supplier network), has won an important piece of business with a NHS shared services organization in the UK. According to the e-invoicing news from across the pond, "The Anglia Support Partnership (ASP), an NHS shared services organisation, is aiming to reduce operating costs through the introduction of an electronic invoicing service...ASP deals with more than 425,000 invoices every year, each of which has to be scanned or entered manually into its workflow system, in order to match invoices with purchase orders. However, it hopes to persuade suppliers to sign up for the Tradeshift service, a web-based business network that provides an electronic invoice service."

CombineNet just released a new study, and the results are fascinating.

Beyond Reverse Auctions/E-Sourcing -- Advanced Sourcing/Optimization Portend Big Shifts (Part 1) -- Earlier this week, CombineNet released the highlights of a recent study on sourcing events using their self-service technology including the types of flexible/expressive bidding fields procurement organizations are using across different event types and categories. The findings are, perhaps, the first data-driven samples we have to suggest how companies are adopting advanced sourcing and optimization tools such as CombineNet alongside traditional e-sourcing and reverse auction approaches. Last week, I had the chance to talk to CombineNet -- in full disclosure, it was on a conference call after a second Old Style at Wrigley while watching the Cubs destroy Prince Fielder and the rest of the Brewers -- about the study before it was announced. During our conversation, I learned the sample size of their analysis was based on data from 47 companies representing some 500+ events in the past few quarters ("most in 2011").

Finally, our most-read piece this week:

Wal-Mart -- Backing Away From China to Source Domestically, or a Shifting SKU Mix? -- Without question, Wal-Mart is the poster child for providing North American households with exactly the type of CPG and retail products they've wanted for the past decade -- increasingly cheap (and increasingly disposable) products from China and other low-cost countries. Since Wal-Mart is usually on the vanguard of pursuing new supply markets, it's worth considering their latest move around embracing more local sources of supply, returning to "buy American" roots. In the above-linked article, we hear, for example, how Mike Duke, Wal-Mart's CEO, "shocked an industry gathering recently when he said a majority of the retailer's products are now made in the United States." Still, as the story points out, you've got to dig below the surface of these numbers to understand the magnitude of the shift to local suppliers. Consider that many of the categories in Wal-Mart's aisles (e.g., electronics, clothes, etc.) are declining as a percentage of their total sales. And these are precisely the types of products that come from low-cost regions relative to grocery and fresh food items, which are often sourced domestically or on a near-shore (e.g., Mexico, Canada, Guatemala) basis.

In this week's rowing news:

I’m playing boat crew for a friend who is rowing from Racine, WI to Milwaukee this weekend as training for her Summer 2012 trip around the entire perimeter of Lake Michigan to raise awareness for breast cancer. Wish us good weather, low waves, and no is our big yellow vessel named Liv, who has already been rowed across the Atlantic twice!

-- Sheena Moore

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