Author Archives: David Bush - Iasta
What if… Actual demand for our product is greater (or less) than forecast-ed? My facilities have different quality standards for the same product? I need to select a “green,” “low-cost country” or “diversity” supplier? My preferred suppliers have capacity or lead-time issues? I have only 10 days to decide the best award for five locations from 10 suppliers, 20 line items and hundreds of bids? A successful sourcing project does not end with an auction; it ends when the awarded … More
This is the first in a series of posts discussing the history of, business case for and strategy behind supplier performance management. Before we can get to the end goal of creating an SPM strategy, we must understand the factors in our supply chains that have caused SPM to become an enormously important part of our processes. Over the past decade, economic globalization has allowed companies to reach suppliers in previously untapped parts of the world. With the ability to … More
According to Peter Orszag, head of the Congressional Budget Office (CBO) and contributor to the Office of Management and Budget blog, “Federal agencies usually rely on hundreds of separate contracts for commonly used office supplies that vary in price. Purchasing supplies through separate contracts does not leverage the government’s buying power across all agencies, providing the cheapest prices.” As all smart buying organizations do, the U.S. Government finally has consolidated its purchasing power to buy office supplies. According to CNN, … More
Today’s post is the second on Center Led Procurement. In these next few paragraphs, I would like to examine the benefits of center led procurement. Center Led Procurement: What does it mean and what does it look like? A center-led model of procurement is where a procurement center of excellence (COE) focuses on corporate supply chain strategies and strategic commodities, best practices, and knowledge sharing while leaving individual buys and tactical execution to the individual business units provides the best … More
One of the ongoing topics in sourcing today is the continued trend toward center-led procurement organizations, where strategic decisions are coordinated centrally while transactional activities are decentralized across the organization, especially in large enterprises (>1B). This post is will be 1 of 2 designed to be a brief introduction to center led purchasing for those readers interested in finding out the basics of how the center led purchasing model differs from more traditional purchasing models. There are three major models of procurement: … More
I recently had a conversation with one of my employees about his trip to Seattle where he shared about his trip to the Boeing museum and a tour of their facilities. This immediately made me think of a video story I watched about Boeing’s supply chain. The news story went into detail about the lessons they have learned about managing a supply chain and its risk while building the enormous 787 jet aircraft. Here are the highlights of the story. … More
Incumbent and new suppliers can sometimes be reluctant with a reverse auction. The most important advice to remember when dealing with these types of supplier situations is: communicate, communicate, and communicate. This point cannot be stressed enough. Many feel that by utilizing an online sourcing tool, all communication only takes place electronically. The e-Sourcing tool should facilitate communication, not replace it. It is important to still maintain professional relationships with your bidders and stakeholders through one-on-one meetings or phone conversations. … More
UNSPSC coding is great for numerous industries, but it seems that there is a void in the coding structure when it comes to large financial institutions. I recently held discussions with several directors of sourcing from large insurance and finance companies while speaking about spend analysis. In each conversation it has come to light that the coding is great for a lot of commodities, but doesn’t address the unique services aspect of their spend. So how do they accurately classify … More
Recently, I’ve had numerous conversations with prospects and current clients where the conversation turned to a familiar topic: What are the key selling points to increase use and adoption into business units who are not using eSourcing effectively? Here are a few short bullets to provide you with a strong business case. These are items that we continue see that sell eSourcing internally as an enterprise solution. Ability to run reports at a divisional level, as well as the parent … More
Last month I met with Reuben Slone, a highly respected supply chain executive with OfficeMax. During the meeting, we had extended discussion of the effort that it takes to publish a book such as the one he just released through the Harvard Business Press. It was fascinating to hear about the peer review process and length of time it takes for a book like this to actually get to market. I encourage you to read this book as it contains … More
We spend a lot of time in sourcing talking projects from the project owner’s point of view. I want to spend a few minutes and layout a few suggestions for suppliers that are engaged in a project that is a reverse auction. Have a war room mentality Have a central location for all bidding and information about the process Take the time to fully understand the technology being used View all training materials, and practice bidding to be completely comfortable … More
OGCs everywhere are finding that their budgets are not immune to the economic downtown. Concurrently, the evaporation of hundreds of millions of dollars in “deal” fees on Wall Street has many of the law firms scrambling for new business in other practice areas. It’s a great time to be sourcing legal. However, you have to be careful in the way you approach this category and the players involved. The relationships and confidence your General Counsel has with all of the … More
We have recently created the Iasta Alliance Group on Linkedin. This private group was specifically created to provide additional value to our strategic partnerships in the consulting realm throughout the globe. We wanted to create a central point for: Relevant discussions on sourcing, with a focus on consulting challenges and opportunities Shared information about challenges and potential solutions while on-site Webinars that focus on on key compenents in the Iasta SmartSource and SmartAnalytics for better understanding in how our platforms are in use with consultants Job postings we … More
I would like spend some time to talk about what’s new in spend analysis technology and the benefits its providing to the market in terms of efficiency, visibility and speed to ROI. Data Extraction and Importation The biggest undertaking with older database driven technology is the time it takes IT to map corporate spend data to required predefined templates which allows the data to be imported by a spend analysis tool. The new generation of data driven technology utilizes metadata … More
Every parent stresses the importance of education in the lives of their children. This is a key component of a successful adult life. The same can be true about a corporation and their sourcing professionals. Successful corporations support, foster and continually educate their sourcing teams with rigorous training requirements. In a recent article entitled “Reaching Sourcing Excellence, Part 3: Sourcing Skills Go Straight to the Bottom Line” they talk about the areas in which education can make a significant difference … More
