Category Archives: Sourcing Blogs

5 Common (and Dangerous) Misconceptions about Sourcing

With the constant changes and innovations occurring in today’s world, sourcing is often a bit of a moving target. And often other departments and stakeholders are confused about (or unaware of) the definition and value of strategic sourcing. What’s the strategic sourcing process look like? Who is responsible and accountable for sourcing events? What technology is used, and how can other departments benefit from this technology? These are just a few of the questions that drive the misconceptions about strategic … More

What Do Chess and Strategic Sourcing Have in Common?

When strategizing on the management of your team in a sourcing tool, you should think about building your players in the game of strategic sourcing in terms of pieces in a game of chess. Having pieces that move differently or perform different functions is essential to the successful implementation of the sourcing solution and critical to developing smooth business processes across the team. Having the fundamentals of chess in the back of your mind also allows you the flexibility and … More

3 Spend Analytics Lessons…From My Closet

Sourcing professionals and researchers advocating spend analytics often say, “You need to be able to predict future spending based on past spending behavior.” However, as for AOL and the industry we are in, I personally believe this statement isn’t always accurate, so I’d like to offer a different perspective – from my closet. We’ve all been there… We grab a pair of pants from our closet, put them on, and realize they do not fit the way they did last … More

4 Procurement Predictions for 2014: Part 2

Welcome back! Just joining in? In Part 1 I discussed two trends that we should look for in Procurement in 2014. Today, I’ll share the final two trends: 3-Increased consolidation of procurement and supplier data analytics –Analytics will continue to drive improvements in the ability to take action in business, probably more than any other technology medium for procurement and business at large. Due to the “Big Data” phenomenon, Analytic / BI platforms will increasingly need to accommodate third party … More

Is Your Supplier Management Strategy Inclusive?

Supplier diversity programs are common in large organizations such as Apple, Johnson & Johnson, and Walmart. Even smaller organizations are starting to recognize the importance of having a supplier diversity program in place. Usually procurement is responsible for managing and reporting on progress against diversity targets, but successful organizations will find ways to include and inspire the entire company to participate in the supplier diversity program. Even though supplier diversity can mean something different for every company, a recent article … More

4 Procurement Predictions for 2014: Part 1

Did you make your predictions for 2014? Predicting events for the year is a common practice for many. You tend to think of yourself as a fortune teller. Some even look to industry-leading sources for predicting future trends, such as The Economist, Forbes or the WSJ, and the procurement community is no exception to these practices. As we begin to predict what’s coming in 2014, there are observable trends that impact our industry in procurement. In my opinion, there are … More

Can ‘inshoring’ be manufactured?

There has been much debate around the ’Made in’ label recently, even on this blog where Procurement Leaders researcher Jon Webb looked at where a keyboard should be labelled as made. During his investigations he spoke to one manufacturer who said that he sourced his electronics from China, had the components assembled in Italy and the final product built in the UK. Where, Jon questioned should this product be labelled as having been ’made in’? The issue for businesses coveting … More

Moving Beyond Cost Reduction to Cost Avoidance: Part 2

Welcome back! Just joining in? Check out Part 1. In order to better understand the trend towards cost avoidance, consider traditional cost containment questions in sourcing which may include: What is the historical price of what we are buying? What discounts / savings can we get from buying now? What is our existing contractual relationship with that supplier? However, when addressing cost avoidance, the questions become much more complex. A cost avoidance mentality drums up sourcing questions such as: What … More

Moving Beyond Cost Reduction to Cost Avoidance: Part 1

As we approach the end of 2013, there are several procurement based trends that will likely continue into 2014. One of these trends we’ve observed at Iasta is procurement’s focus away from cost savings and towards cost avoidance… We discussed this topic during our webinar, Strengthening Procurement’s Impact: How to Capture the Bigger Picture of Savings. Guest speaker Lutz Peichert mentioned that procurement today is being driven by a number of areas including disruptions through technology and customer experience that … More

How Sourcing Analytics is Changing Leadership

Procurement continues to look for ways to define themselves as a true profit center rather than a cost center. The problem typically arises in the form of defining what exactly they bring to the table. It’s easy to make generalizations like “Procurement saves money” or “Procurement brings efficiency”, but it’s hard to quantify these statements. However, as organizations turn towards automated ways of tracking KPIs associated with Procurement activities, such as cost avoidance, savings, and cross-functional collaboration, leadership is paying … More

How to Develop Your Modern Sourcing Strategy with Analytics

In today’s world, procurement pros need a solution that gives them a deep understanding of their data sources. Everything you do is generating data. Every sourcing project. Every interaction. Every purchase. Every new relationship. Every contract. Every transaction. Every supplier scorecard. Data can pile up quickly. So where are you storing all of this data? What stakeholders and internal business units require request access to corporate data to make better business decisions? What data is missing or hidden because you’re … More

How Modern Sourcing Promotes Innovation: Part 2

Welcome back! Just joining us? Click here to read Part 1 in this series which recaps the importance of innovation and what successful innovation looks like today. The successful implementation of innovative ideas demonstrates that despite the potential access to more resources, bigger is not always better. For the strategic sourcing application market, this simply boils down to the corporate genetic make-up of a small versus big company. For instance, as many business gurus may attest, small businesses (that includes … More

Key Ingredients for Baking the Perfect Sourcing Cupcake

Have you ever thought of what ingredients it would take to bake a sourcing cupcake? Unless you’re a baker and procurement pro, the thought has probably never crossed your mind. But I’m a baker – and refer to myself as a “Modern Betty Crocker”, so this crazy thought crossed my mind the other day when I was baking Mudslide cupcakes. (Mmmmm) So, I started thinking, “What ingredients would I need to bake the perfect sourcing cupcake?”  In order to bake … More

Data: The Key to Procurement Transformation

What is the key to a successful procurement transformation today? The question could be answered in a variety of ways, but for me – it simply comes down to the data ownership and visibility. In just a few days, I’ll be speaking at an ISM Dallas meeting about how best-in-class procurement organizations are using data as the enabler of change and the communicator in the procurement lifecycle. Consider the power of having a single interface to analyze your spend, supplier … More

How Modern Sourcing Promotes Innovation: Part 1

As we continue to advance on the idea of modern sourcing, it is critical to understand there are multiple dimensions that require innovative ways of looking at how sourcing techniques, contract management, and supplier management must overlap and work together. I must stress that the key word here is “innovation”, a key topic covered in a recent blog on Spend Matters as to why “best-of-breed” strategic sourcing providers are showing the path for how modern sourcing needs to adapt. Why … More