Yes or No: Soliciting Pricing from Alternative Suppliers is the Best Way to Benchmark Your Incumbent?
This week’s Wiki-Wednesday topic is benchmarking, and we are covering it at the suggestion of BMP member Victor Halchin. A discussion has been going on in the Strategic Sourcing & Procurement group on LinkedIn in response to the following question: "If you are "locked " into a supplier , would you be prepared to try another for benchmarking even if it was just to "bash " down the supplier on price - would you change suppliers if you were offered the same service at reduced costs on your purchasing requirements?”
I recently discovered a white paper that speaks to the exact premise of “The Flip Side” here at Buyers Meeting Point – that sales and procurement have a lot to learn from each other: ‘When Sales and Procurement Collide’.
This post is a follow up to 'Innovation Through Procurement Contests' (Part 1), my thoughts on Procurement Insights’ 3 part (so far) series on contests in public procurement. I’ve had a chance to think about the idea a little more and as far as I’m concerned, if it allows the buying organization to put the right solutions in place, then it is a benefit. As I commented in my previous post, the concern becomes for the procurement professional whose role becomes one of administration rather than strategy and negotiation. Although I didn’t realize it at the time, I had started down the road towards what would become a sticking point for some of the collaboration-style projects often resulting from new solution development: intellectual property rights.
The event had an interesting format - four speakers, same topic: quick savings wins. While all of the speakers were qualified, two set themselves aside by taking on the harsh realities of trying to increase savings for the year with only a sort time left to go.
This week's Wiki-Wednesday topic is Innovation, and you can click here to read an excerpt or to link back to the Wikipedia article. We chose this topic because of a series of posts being done this week by BMP mentor Jon Hansen on his blog Procurement Insights. He is addressing a growing debate over the benefits of using procurement contests - particularly in public procurement - to innovate without absorbing the direct costs of a major R&D investment.
This week’s Flip Side topic comes from a webinar and white paper put out by The Executive Conversation and the Brandon Hall Group in July 2011 “Essential Selling Competencies: The Buyers Side Perspective”. I haven’t been able to find a place on either company’s website for you to directly download the whitepaper or listen to the archive of the webinar, so let me start by giving you a quick rundown on the whitepaper itself.
Six Ways to break a Negotiation Deadlock (Plus One More) A You Tube Video from Blue Elephant Consulting
I’m taking a break from the usual this week, and rather than covering a webinar, I’d like to share a new series of YouTube videos with you. Don’t get your hopes up – there are no home movies of cute cats falling down stairs or into grocery bags. Instead, I’d like to introduce you to a series of 5-7 minute videos made by Dr. Jim Anderson of Blue Elephant Consulting, and the writer of “The Accidental Negotiator” blog.
When I am reading the books that may end up on the Buyers Meeting Point Endorsed Publications list (in the Procurement Library), I often find that they are missing a certain… something? Now I know what it is – cartoon illustrations! All joking aside, I am now in a position to recommend a book that contains solid procurement advice and pictures. Read all the way to the end of this interview to see my favorite from the book.
Last week I attended an excellent supply chain risk management webinar sponsored by the Next Level Purchasing Association and featuring a global supply chain manager from a Fortune 500 company. The event followed the story of this particular corporate supply chain through the 2010 tsunami in Japan (you can click here for my notes).
One of the lessons this particular company learned was about finding the right place for addressing the human side of a very complicated business issue. I was impressed with the efforts they had made, particularly for such a large company. A thought started to form in my mind: what contract clauses were put aside in order to have an appropriate response to the devastation while not creating serious business continuity issues?
In order to get another perspective on the topic of procurement outsourcing, we reached out to our undercover sales expert, "The Sales Guy". TSG is a sales VP with 30 years and approximately $1B+ in sales under his belt. We are keeping his identity under wraps – for the same reason magicians never reveal their tricks, his colleagues might not like him giving us the inside scoop on sales’ view of procurement. Here are his thoughts...
Weekend Extra: BMP’s Webinar Notes on 'A Case Study for Proactive Supply Chain Management' by Next Level Purchasing
Before I even begin my notes, let me just point out that if you are not a member of the Next Level Purchasing Association, you are missing out. Next Level Purchasing offers the SPSM (Senior Professional in Supply Management) certification program. Joining the association is absolutely free and comes with a number of benefits, such as members-only webinars, newsletters, and networking opportunities. If you want to get your feet wet with the kind of programs they offer, there are several mini-courses they offer, completely online and for less than $20! Interested? Good for you! Click here to learn more by clicking on the NLP logo on our partner page. That way Buyers Meeting Point gets credit for your purchase and a portion of the proceeds go to charity.
This week’s webinar on legal process outsourcing by SIG was an interesting look at a profession in much the same position as procurement; legal departments are cost centers whose responsibility can be fairly clearly divided into strategic and tactical responsibilities, leading corporations to outsource some of the work in order to minimize overhead. You can read more about the parallels between legal and procurement in my recent blog post ‘Professional Responsibility in Procurement’.
As you’ll read more about on Friday, this week’s BMP event pick is the Ethics of Legal Process Outsourcing presented by Sourcing Interests Group. As a tie in, today’s Wiki-Wednesday topic is “Professional Responsibility” – mostly because the phrase “competent representation” doesn’t exist as a Wikipedia page. Without stealing all my own thunder for later in the week, the event was very interesting, and it gave me an opportunity to consider some parallels between the outsourcing of legal services and procurement’s contribution to an organization.
This week’s webinar notes are actually on an event from a couple of weeks ago: “An Introduction to Supply Chain Response Management – driving supply chain performance through responsiveness to unexpected events release” presented by Kinaxis. I missed it that week, but really wanted to go. Now that I’ve gotten to hear it, I can share my notes with you.
It is impossible to turn on the tv, check a news site or pick up a newspaper this week without being confronted by a wave of bad economic news. Here are just a few example headlines from August 10th:
"Stocks Dive on Europe, Economy Fears" - WSJ.com
"Shares Plunge as Eurozone Woes Return" - FT.com
"Discovering the Real reasons for the Market Plunge May Take Time" - TheEconomist.com
So despite the fact that you feel a little queasy each time you check in on your 401K, what reaction are you supposed to have - specifically in your role as a procurement or supply chain professional?