Category Archives: Functionality
One day last week, I was driving to work and listening to a story on NPR about a coffee farmer from a remote region in Guatemala. The story continued as they discussed a hip coffee shop in Portland, Oregon that is using spend visibility to sell cups of coffee. Okay, they didn’t say, “spend visibility,” but the coffee shop is certainly following spend analysis logic. The story by Allison Aubrey was about how a struggling coffee farmer managed to cut … More
Perhaps your organization has a contract already in place with a service provider, and you are thinking those pre-negotiated contract terms and conditions might save you time and money in sourcing the next area of your business. Or perhaps your organization decides that skipping a competitive process and sourcing directly with one service provider will be more efficient. Of course, sole-sourced contracts can be successful, but these Top 5 suggestions remind us that a competitive solicitation process delivers increased knowledge … More
For many Sourcing organizations, especially those at mid-market companies, being involved in Strategic Sourcing of Indirect Spend categories is still a relatively new opportunity… and a challenge! Many manufacturing companies, which have historically had sourcing organizations focused on Direct Material and Capital Equipment purchases, may not have the internal staff or correct Subject Matter Experts (SMEs) to get involved in negotiating and managing indirect expense categories. In fact, sourcing organizations may not even exist at some companies, namely those in … More
Despite the challenging circumstances of today’s economic environment, you must embrace change in order to support shifting external environments and business strategies. At the same time, you look for opportunities to capitalize on disruptive changes in supply markets, which can drive greater value for your organization. You must become a purchasing hero. What is a purchasing hero? We believe a purchasing hero brings knowledge capital to multiple departments. They inspire collaboration and cross-coordinate with as many internal stakeholders as possible. … More
In a previous blog, we discussed the use of spend analysis technology as a compliance tool. Today, I want to introduce an additional value that spend analysis can greatly improve—sourcing cycle time performance. In today’s world, spend visibility has become vitally important for procurement organizations to make the right sourcing decisions, especially when there is an increased focus and visibility on driving bottom-line results. With added pressures on procurement teams, often the primary way to improve the bottom-line is to … More
Until recently, governments at all levels have found the market for budgeting tools to be woefully inadequate. Accordingly, most governmental organizations continue to use cobbled-together, Frankenstein-like budgeting tools that, more often than not, rely on users to extract or re-enter data in offline spreadsheets to analyze budgetary policy proposals. Such tools are labor-intensive, inflexible, error prone, limited by the data collected and fail to provide timely, sufficient budgetary insight to optimize resource allocation. In this time of greater public budget … More
Welcome back! Just joining us? Click here to read Part 1. Today, I’m going to focus on how you uncover the underlying business problem(s) to mention when submitting your feature requests. At the surface, such a feature request may seem simple enough. However, we cannot neglect to consider the following: The requested button would do X, Y, and Z. Simple enough, right? Well, don’t forget that X touches A and B, Y touches C and D, and Z touches E … More
How many times have you used a piece of software and thought, “I wish there was a button that did X, Y, and Z…” Or what about, “Why does it work this way, instead of the way that’s more convenient for me?” Trust me, we’ve all been there. Depending on your perceived severity of the question/complaint, you probably acted in one or more of the following ways: Ignored the issue and continued working Complained to your coworkers, friends, or blog … More
Contract management is an important aspect of managing supplier relationships and ensuring that commodities and services are negotiated at the right time. Unfortunately contracts are often managed poorly within a company. Even a smaller company can have hundreds of active agreements, adding up to thousands of contract terms and clauses. As you may know, not one of those contract terms carries much weight if the agreement isn’t monitored and enforced. Procurement Managers know that getting a fair price on goods … More
Many times organizations begin using eSourcing tools with the mistaken assumption that the tool will automatically take care of all the work for them. Communicating with suppliers throughout the eSourcing process is probably the most neglected, yet important, piece of an eSourcing project. One of the biggest mistakes a project manager can make when running an eSourcing event is to publish the project and then wait for supplier responses. The project manager needs to engage suppliers and demonstrate how important … More
As you and your team are preparing to execute your Procurement strategy for 2013, consider adding these resolutions to your “to-do” list: 1. Tell your sourcing story. Has your team transformed processes or implemented new technologies that blew the socks off senior management? Tell everyone by sharing your sourcing stories. Consider creating a quarterly (or monthly) newsletter or e-mail to distribute to the entire company so you can publicize your successes and impact on the organization’s growth and bottom line. … More
When examining spend, the most effective way to start is at the top. This method will expose categories with the most savings opportunity because more savings are reaped from higher spend. A lot of corporate spend falls into only a select few categories. For example, a company may have 80% of its spend going to Financial Services, IT, and Published Products. A good spend analysis product should display a Pareto Analysis within each category in its reporting suite. From there, … More
When procurement professionals are speaking with me about spend visibility, one of the first questions I ask them is: “What do you want to accomplish with improved spend visibility and data?” I lead with this question because there are many ways to define spend analysis as part of the strategic sourcing process and countless ways to empower sourcing professionals with actionable information. I encourage my clients to start with spend velocity reporting as a traditional starting point, which helps access … More
In Part 1 of this series, I explained how the contract status and having clear specifications / requirements can drive the success of your reverse auction. Click here to read Part 1. Today, we will cover 4 more elements to consider when developing your reverse auction project and strategy. Is the spend volume attractive? The bigger the potential business award, the more likely suppliers are to compile all of the pre-auction information such as non-price factors in an RFI or … More
