Buyers Meeting Point procurement by Kelly Barner

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"The Point" is written by BMP Editor Kelly Barner as well as a diverse group of guest contributors.

Achieving World-Class Procurement Part 2: Taking a Deep Look at Your Current Operations

Achieving World-Class Procurement Part 2: Taking a Deep Look at Your Current Operations

As I mentioned in Achieving World-Class Procurement Part 1, today’s increasingly competitive market landscape is driving organizations to reinvest in their procurement and strategic sourcing departments like never before. Beyond establishing centralized purchasing operations, best-in-class companies are elevating their procurement organizations by taking a deeper look at people, processes, technology, and metrics and optimizing them in ways that support enterprise-wide goals – through procurement transformation.  Transformation initiatives allow companies to gain more value from their procurement operations, moving from a reactionary model focused on reducing costs to a more proactive approach to managing spend that streamlines purchasing practices and enhances supplier relationships.

 

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Best Procurement and Supply Chain Webinars 8/8 - 12

Best Procurement and Supply Chain Webinars 8/8 - 12

Although there are only a few webinars taking place (again) this week, they are all high quality and on a compelling range of topics. Click on the title of each event below to view the full description in our events calendar and to connect to their registration pages.

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How much should a procurement process vary by company or category?

How much should a procurement process vary by company or category?

Last week I shared six B2B buying processes being compared by Wake Forest University in North Carolina. You can learn more about their research here.

I looked at the processes, and can see where each of them would have a place in the right scenario. You would expect processes to be different by company or industry, but do you ever vary your process by category? Feel free to share you comments below or join the conversation on Twitter: @BuyersMeetPoint.

I think (E) Robinson, Faris, and Wind most closely resembles the standard strategic sourcing process that most organizations follow. A typical process usually 6-8 steps, starting with internal and historical data collection and leading to either supplier performance management or a hand-off to the internal stakeholders who will manage the relationship for the duration of the contract.

That being said, the other models match different (and maybe less typical but no less common in the grand scheme of things) procurement situations...

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Which sequence best represents your buying process?

Which sequence best represents your buying process?

Professors Michelle Steward and Jim Narus at Wake Forest University in North Carolina are learning about the B2B buying process. In particular, they are interested in the buying process that you find fits your current job. Please select one of the six models (below) that best fits your buying process. Feel free to note any differences or customized aspects if what you see does not match your job exactly. The collective findings from the study will be used for academic journal articles that are aimed at explaining how the buying process has changed over time. All participants will be sent a copy of the final paper. No names (personal nor company) will be used in the publication, only general findings will be reported.

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Guest — Isaac
Process F represent what we are using
Saturday, 18 July 2015 14:44
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Webinar Notes: A Primer on Robotic Process Automation

Webinar Notes: A Primer on Robotic Process Automation

“The bigger you are, the more likely you are to fail because of the change required in aggregate.” – Thomas Young, Founder and Managing Partner of RUMJog Enterprises

“This is real.” - Frank Casale, Founder of the Institute for Robotic Process Automation and the Outsourcing Institute

 

These webinar notes are from a May 28th event run by the Institute for Robotic Process Automation (IRPA), which was founded by the Outsourcing Institute’s Frank Casale. Casale was joined in the event by a panel of Robotic Process Automation (RPA) experts: Raheem Hasan (CMO, IRPA), Pat Geary (CMO, Blue Prism), and Thomas Young (Founder and Managing Partner, RUMJog Enterprises).

Recent Comments
Guest — Kelly Barner
For anyone that is interested, the webinar can be viewed on demand using this link: http://www.irpanetwork.com/webinar-an-introduc... Read More
Friday, 05 June 2015 15:07
Guest — Jack
The new age of RPA (robotic process automation) which can transform the running cost and the overall operation of a business is as... Read More
Friday, 06 May 2016 09:00
Guest — Kelly Barner
Hi Jack,Thank you for sharing your experiences! RPA is such a new topic that most people are just starting to find their way. Woul... Read More
Friday, 06 May 2016 09:04
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Procurement Decision Making - Who Empowers Who?

Procurement Decision Making - Who Empowers Who?

This week’s Wiki-Wednesday article is part of the series on Next Generation Sourcing: Empowerment. As a strategy in procurement, empowerment has the potential to change the course of a project at many points:

Which suppliers are invited?

How will we structure the RFP or RFQ?

What negotiation strategy will be the most effective?

But no other decision in a project has more of an impact than the supplier award. Which suppliers will be awarded contracts, for how much, and what will the terms be?

Depending upon the organizational structure in place, and the model of the procurement organization, their role in that decision can vary from decision maker to observer. The model may also vary from project to project, and between direct and indirect spend.

Procurement as Decision Maker

In categories where cost is the primary factor affecting a decision, the project is to get a specified good or service for the total lowest cost, procurement will work the sourcing process and notify the business which supplier(s) offered the lowest pricing. Procurement is positioned to suppliers as the process owner and the ultimate authority for the category. If there is an executive approval process for this award, it is usually an administrative sign off on the decision before a contract is signed.

Procurement as Facilitator

In direct categories where there is an active business owner, procurement manages the sourcing process (with frequent involvement of the business owner) and then presents all qualified options so the owner can make an award decision. Procurement can present themselves to suppliers as an objective party, open to their ideas, taking care not to appear as though they have no influence and allow suppliers to bypass them. Executive approval for the award will ensure that the business owner does not give inappropriate advantage to the incumbent or miss out on opportunities to innovate based on aversion to change.

Procurement as Collaborator

In strategic categories of spend, procurement and business owners may take equal roles in the sourcing process. Procurement owns the sourcing process and technology use in the project and the business owner is responsible for category knowledge. Each party is able to leverage their strengths, collaborating on the structure of the RFP, negotiation strategy, and execution. Both will have input on the award decision, with executive approval of the recommended award made by the combined team.

If you are interested in reading more about decision making in procurement, Charles Dominick of the Next Level Purchasing Association published a three part blog series on the topic on the eSourcing Forum in 2008 that still holds true. In these three posts, he looks at basic, advanced, and expert decision making capabilities across cost, support performance, and innovation.

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Flip Side Webinar Notes: Closing the Gap – Your Sales Process and Their Buying Process

Last week, I attended a ValueSelling Associates webinar called ‘Closing the Gap: Your Sales Process and their Buying Process.” In this event, VSA looked at the differences in timing and expectations between the supplier and buyer sides of the procurement process. Two types of value come from this kind of event.

  • We get a window into Sales’ perception of procurement professionals and our process, and
  • We learn how to improve our performance by hearing which parts of our process may be preventing us from accessing potential value or innovation.
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