Category Archives: RFx / Auctions
Love it or hate it, but there is no denying that eSourcing has revolutionized the purchasing arena. Negotiations will never be the same. Strategic eSourcing initiatives, processes and technology bring clear benefits to companies by: • Speeding up the negotiation time. Time savings is one of the most significant benefits of using eSourcing. • Increasing transparency. Both companies and suppliers get real-time visibility into what should be considered fair market prices. • Levelling the playing field for all parties. Everyone receives the information … More
Which came first: the chicken or the egg? From Wikipedia, “To ancient philosophers, the question about the first chicken or egg also evoked the questions of how life and the universe in general began. Cultural references to the chicken and egg intend to point out the futility of identifying the first case of a circular cause and consequence.” For me, this question is so procurement. You might think the last thing I would consider when I am talking to my … More
by Paul Reynolds Payers, providers, and equipment manufacturers in the U.S. health care sector have reacted differently to legislative changes over the last year. Many of the challenges & opportunities facing these groups are the same. According to TPI’s latest Momentum Market Trends & Insights Report focused on Vertical Industries, the Health care Equipment & Services market has grown every year – with the exception of 2008 – since 1994. With market penetration reaching 36 percent in 2009 and continuing, … 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
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
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
Many companies negotiate small package programs to cover the documents in small packages, but how much consideration is given to those shipments with weights between 200 and 300 pounds. Normally a shipper will tender those shipments directly to an LTL carrier along with other shipments. These shipments are known as minimums in the LTL industry and are either tendered loose or stacked on a pallet and shrink-wrapped. These shipments can create problems in handling simply because they command an allotted … More
e-RFx, likely one of the most common acronyms in the procurement, sourcing, and related literature, does not stand for anything in particular, as the X can be a placeholder for I, P, Q, or B which stand for Information, Proposal, Quote, or Bid (though the latter is primarily used in the public sector). Some benefits of the e-RFx process include: Sourcing Cycle Time Reductions An information gathering and analysis cycle that used to take months can now be completed in … More
I have previously profiled some of the best practices for a reverse auction process. In the final point, I mentioned that better communication with suppliers would help build confidence (and thus participation) in the process. Here is a real example of what happens when most of the rules and suggestions from last week are disregarded. I originally wrote this as part of the eRFx Wiki Series. Profile: A global, multi-billion European pharmaceutical company determines the need for a large scale … More
A generally accepted (and obvious) “best practice” is to procure services via a robust competitive methodology. In general, this is achieved by issuing a comprehensive request for proposal (RFP) to each of the potential vendors for that service. The practice has now become so common that many organizations have developed a standardized template (or templates) and are able to rapidly churn out RFPs to meet the demands of its business unit customers. This semi-automated approach accelerates the overall procurement timeframe … More
How many bidders do you need for an electronic auction? There are a variety of “expert” opinions on this question. Is it three, four, five? I have heard all of these recommendations. The correct answer is: at least two. But the actual number depends. I have experienced circumstances where two bidders were plenty. It was a sellers’ market. There was significant over capacity, and the two bidders were hungry. They fought for the business in a bidding war, and the … More
Tomkins Associates released some survey results from a recent study they did regarding supplier relationship management with Asia. With the promise of capitalizing on the low cost labor in Asian counties, businesses have been in an incredible rush to capture the economic benefits. However, companies that do not do their homework are often surprised to find that the business practices they are accustomed to in North America do not work as well in Asia. In the report, which was authored … More
It has been a very long time since I wrote a summary of what is going on, over on the ESF sister site – eSourcingWiki. Since many are now taking long weekends, or full holiday right now, today is a good time to bring attention to what exactly is going on over there. The wiki series are broken into 4 main categories: The Basics, The Technologies, The Methodologies, Global Sourcing Primers. Within each header category, there are numerous papers on … More
Managing Iasta’s user group conference, reSource ’08, was much, much easier this year thanks to SmartSource SRM. Yes, its true, a marketing professional used an eSourcing application. I used SmartSource SRM to collect information and negotiate favorable rates for our conference facility. This included meeting rooms, guest rooms, parking and wireless Internet access, among other things. The process saved me vast amounts of time, not to mention providing direct benefits for our attendees. After I confirmed the facility, I expanded … More
A generally accepted (and obvious) “best practice” is to procure services via a robust competitive methodology. In general, this is achieved by issuing a comprehensive request for proposal (RFP) to each of the potential vendors for that service. The practice has now become so common that many organizations have developed a standardized template (or templates) and are able to rapidly churn out RFPs to meet the demands of its business unit customers. This semi-automated approach accelerates the overall procurement timeframe … More
