ESF Benchmark Analysis - Day 1

March 20th, 2006 at 09:23am David Bush - Iasta

Standard Operating Procedures
I mentioned in my last entry that we’ll be talking about the information Iasta discovered by conducting a Benchmark Survey in 2005. The first area I wanted to highlight was that of Standard Operating Procedures for sourcing. I emphatically believe that successful organizations need to use OPs. The tricky part is having the right number of OPs to aid consistency and performance across team members. With too few OPs there is maverick behavior, with too many OPs - individuals become too controlled and restricted.

Standard Operating Procedures (OPs): When examined across all respondents, it appears that slightly more companies (52%) have OPs than do not (48%). However, when reviewed more closely, this area demonstrates a great disparity between Large and Small companies. It appears that the larger a company is the more standardized operating procedures it is likely to employ.

It is logical to assume that smaller companies tend to rely more on informal teams and processes. Spend is usually centrally managed and communication can be easier in smaller companies. However, based on rapidly increasing inbound interest from SMBs (regarding the Iasta software) and analysts’ opinions, like Aberdeen, it seems that these mid-market companies are beginning to trend towards sourcing automation.

These procedures build the foundation for successful sourcing operations. Without having adequate and controlled operating procedures, it is difficult for any company to maximize its potential and be truly efficient. Smaller companies would greatly benefit from the implementation of such processes and incorporating strong sourcing automation functionality.

Tomorrow we will look at reverse auction usage patterns across business size.

If you are interested in reading the full report, please email survey@iasta.com and request a free copy of the e-Sourcing Benchmark Diagnostic. Please include your corporate email address only.

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Entry Filed under: Analysts/Research, Contract Management, Functionality, General, Global Supply Issues/Risk, Optimization, Project Management, Reverse Auctions, Spend Analysis, Supplier Performance, Supply Management Best Practices, Technology / SaaS, e-RFx, e-Sourcing Marketplace