Buyers Meeting Point procurement by Kelly Barner

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Recommended Procurement Webinars for April 24 - 28: Procurement Finance 'Drama' Plus Millennials

Recommended Procurement Webinars for April 24 - 28: Procurement Finance 'Drama' Plus Millennials

It is spring, and there’s something in the air… it’s not quite romance, but there will be plenty of drama with two examinations of the procurement finance relationship on Wednesday. If you’re looking for an alternate subject, consider the role of millennials in supply chain or sourcing optimization. Click on the title of each webinar below to view the full description and register.

BTW: If you haven’t already, sign up for our mailing list to be sure you get my weekly recommendations in your Inbox each Monday.

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Can Real Human Beings Be Good at Procurement?

Can Real Human Beings Be Good at Procurement?

This guest post is part of The Procurement Revolution. To share your thoughts or join the conversation, use #ProcureRev on Twitter or use the comment functionality below.

 

I'm Ovidiu Slimac and I am from Timișoara in the western part of Romania, a beautiful town which was just declared the European Cultural Capital for 2021. 

 
I have worked in procurement for 15 years now. And yes, I'm human. I'm a human being. And if we believe what the researchers and scientists say, all of my purchasing activities and buying decisions are made with an emotional input – even the ones I made for my company. The question is: does being human disqualify me as a good procurement professional?

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Procurement depends on the honey bee

Procurement depends on the honey bee

We have several very large rhododendron bushes in our yard. In the spring they are beautiful with pink and lavender flowers. There are thousands of blooms. What we have noticed over the years is that the honey bees are fewer and fewer. It seems impossible for what seems like less than a dozen to be able to hit all the areas they should be covering.

Of course no one likes to get stung so fewer bees is a good thing right? WRONG! They are desperately needed to pollinate all the fruits and vegetables that we have in our food supply. The impact on the economy is in the billions of dollars.

The article this week from The Strategic Sourceror is “What’s the Buzz? Honey Bees in serious danger”. It reveals in simple terms why we need to pay attention to this and solve the problem. We have created this issue with the increased use of pesticides and the planned crops instead of wildflowers. Apparently the wildflowers sustain the bee population better than other crops.

Published in June 2014, the US White House has issued a fact sheet,  “The Economic Challenge Posed by Declining Pollinator Populations”. Here are a few facts stated in the document:

  • Honey bees pollinate 90 of the North American crops and 87 of the leading 155 food crops, representing 35% of the global food production.
  • Honey bees account for more than 15 billion dollars to the US economy

How does that impact procurement? The law of supply and demand could cause prices to increase on a something needed for your business. All the supermarkets, restaurants and food services will be impacted if the price of food increases. When the consumer has less disposable income, less is spent on clothes, cars, travel and entertainment. There is a ripple effect that will cause procurement to seek alternatives in order to contain costs.

How has your organization been impacted by the honey bee? Perhaps not at all but do you have something similar? Is it something that seems minor but has the potential to cause a major shift in your industry?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Boomers vs. Millennials in the Marketplace

Boomers vs. Millennials in the Marketplace

Recently, we were at a hotel and happened to meet the resort president as we waited for our table. We had a wonderful conversation and explained we were celebrating our anniversary. Several hours later, we arrived in our room to a bottle of champagne and chocolate covered strawberries. We were so surprised and found it was compliments of the president. That was amazing customer service and truly they have gained our loyalty.

How do retailers or any organization for that matter gain your loyalty? For decades, the marketing was focused on the Baby Boomers (b. ’43-’64) as they were such a force in numbers and buying power. While that is still the case by spending power, The Millennials ( b. ’76 – ’92) are coming on strong in numbers and soon will be reaching their peak spending years.

This study, by Synchrony Financial, Balancing Multi-Generational Retail Strategies, reviews some of the different approaches and how organizations could benefit from utilizing them. As the subtitle suggests, you want to win over Millennials without losing the Boomers.

The similarities in the two generations are not surprising:

  • Both love coupons and discounts and bargains
  • Both use social media to share recent experiences
  • Both use online shopping
  • Both own tablets and smart phones

The article then goes into some of the differences and suggestions on how organizations should stay current in order to attract the future generation and buying power.

Millennials are more price conscious and make their purchasing decisions accordingly. Boomers are also price conscience but have brand loyalty based on customer service.

While Boomers and Millennials both own tablets and smart phones, they use them quite differently. Boomers have to think and ‘work’ their devices while Millennials use them as an extension of themselves, almost as simple as breathing. The mobile experience has to be fast, helpful and productive for Millennials as a given, not an exception.

With all that in mind, how do these generations and their preferences impact you as a procurement professional? What factors are you considering as you plan your assortment and your go-to-market strategy? What is your approach to the "bottle of champagne" surprise?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Procurement Delivering on Best Value

Procurement Delivering on Best Value

When our children were ready to buy their first cars, they had saved up enough to get something that was safe for driving around town and within their budget. However, they did not take into account the total cost of ownership so we outlined it for them. It was not just the purchase price of the car but also gas, insurance and repairs. They were not excited about those expenses. Buying new tires or fixing an exhaust problem was not high on their list of ways to spend money. Believe me, it is not high on anyone’s list no matter what age they are!

This week’s article by Kate Vitasek, “Use Best Value to get Your Best Bottom Line”, discusses the role of procurement and shifting to focus not just on cost but on the full cost of ownership. It emphasizes that while most professionals understand getting to the TCO is the best value, many do not employ that methodology.

It is often about so many other things such as how soon a new piece of equipment needs to be repaired and how much do the parts cost when a repair is needed. How far away are the service centers that could impact the length of time a piece of equipment is out of service? When it is time to dispose of the equipment, what is the cost of that or is there some ability to recycle or sell it?

What success stories do you have around procurement and the TCO or Best Value approach? Is it easier to apply in some cases and not in others?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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How Consumers Influence Your Procurement Team

How Consumers Influence Your Procurement Team

Panera is in the news this week with their “No-No list”. They will be eliminating over 150 artificial ingredients from their recipes, beginning immediately with their salad dressings. This is in reaction to the increasing consumer demand to understand what they are eating and requiring heathier choices.

I was reading an article from Social Media Examiner, “5 Ways you can Influence Consumer Purchasing Decisions”. Obviously there are a lot of choices of where to eat and Panera is hoping to influence you to choose their establishment.

One of the suggestions is to appeal to millennials. Using social media, you can reach the millennials but it has to be done in the right way. They are not looking for generic messages but those that are tailored specifically to them. Being very aware of the environment, the move for Panera is more than likely to appeal to that age group so interested in sustainability and healthy choices.

So what does that mean for a procurement professional at Panera? It will require new supplier agreements, finding alternative sources of supply, including various lead times. The supply chain has been altered based on consumer demands. The purchasing group has to be consistently learning new marketplaces and sources for their organization.

Has consumer behavior changed your company’s direction and product offering? How did that impact you and your team? How did this impact your bottom line?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Go Ahead - It won't hurt to network

Go Ahead - It won't hurt to network

Earlier in my career I was quite shy and not comfortable networking at various conferences and seminars. Everyone else seemed to be talking to someone and having a good time I did not know where to begin. It is still not like breathing but it is a bit easier. I learned to ask questions about their jobs, families and vacations. It was interesting to hear their stories and learn a few things along the way.

Networking seems forced, self-serving and artificial to me. Instead I approach these opportunities more along the line of meeting others in my industry. This week we chose the Strategic Sourceror, Why YOU should be networking. It outlines 3 reasons to network:

  • Open communication – share ideas and get feedback as well as hear other ideas
  • Best Practices – learn what and how others are doing the same thing you are
  • Opportunities - for new business leads or a new career opportunity

Another article by Amazing Business, Top 9 reasons of Business Networking, has additional benefits worth reviewing.

  • Advice – being around like-minded people is a good arena to gather advice for your business.
  • Increase confidence – like anything else, you get better with practice. I certainly did as each time I came out of the comfort zone to meet more people.
  • Satisfaction from helping others – Everyone has problems and issues. Perhaps you have something to offer that can help them.

What have you done about networking within your procurement profession? Did it seem difficult and first and get easier as you went along?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Procurement and Taxes

Procurement and Taxes

Today is April 15 and also TAX DAY in the United States. It is the deadline for citizens to file their income tax returns for both the Federal and States taxes. Yes you can get an extension but only if you fill out the forms needed. Plus if you owe taxes, then you have to pay them anyway by April 15 and the paper work just follows. Sometimes you have overpaid and get a refund. Then it seems really worth doing all the forms and filing early!

With that in mind, I came across this book, “Death, Taxes and Procurement, An Effective guide for Small Businesses”. The author, Robert D. Horesjh, takes a fictitious company through the steps necessary to do business with the US Federal Government. They are the one of the largest consumer of goods and services for businesses to sell to. Of course they are – they have just finished collecting everyone’s taxes so there is money to be spent!! The marketplace extends to include schools, towns and local agencies.

Full disclosure, I did not read the book but skimmed areas of it. It is an easy read and a primer of sorts to get you started. Many companies do not try to bid for the government business due to the reputation that it is too hard and overwhelming. Thanks to technology, it is getting easier to go through the process. There are definite rules and expectations but it is not as cumbersome as it once was.

Has your company bid on any government procurement projects? What did you learn along the way? Does it get easier the second time around?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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When is the Joke on YOU

When is the Joke on YOU

Today is April Fools Day. This day of practical jokes goes back to the 1300’s. Everyone has a story to tell about the joke that they pulled off. If you look at Google Maps today, the image is turning into a Pacman game that you are trying to win instead of following the directions.

It is more fun to deliver the joke than receive it. We can be good sports and laugh it off but in reality, we may not have appreciated it at all. This can be the same in your professional life if you are not prepared when dealing with your suppliers or your customers.

This week’s article is from the salesman’s perspective. The account manager that comes in to visit the procurement lead does not want to appear a fool. Sales About has an overview of the five elements of sales. As a procurement professional, you can spot them in the good salesman and appreciate that they have come prepared.

History: Know the company that you are visiting. Taking the time to do this research will be worth it.

Expertise: Know your products line and what it can do for the customer.

Appearance: Look professional, organized and confident.

Readiness: Have the tools, listen and understand your customer’s needs.

Teachable: Be willing to learn and keep an open mind.

The article discusses using these approaches to increase your profits and your business.Have you utilized this in working with your customers? Have you been able to avoid feeling like a fool?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Negotiation is child's play - or maybe not

Negotiation is child's play - or maybe not

When our daughter was in elementary school, she was a tough negotiator. She wanted her independence at a very early age. When it came time for bedtime, we came up with a plan. She could go to bed anytime she wanted up until 8PM. It was her choice. She loved that freedom and the rest fell into place. From our perspective, we wanted her in bed by 8PM anyway but it was all in how it was presented.

Negotiation is something we do every day – sometimes with ourselves and sometimes with others. Should I have dessert, that cookie, that extra glass of wine? Who on the team should do the analysis, the presentation, make that sales call?

In procurement, this is a key skill that constantly needs to be sharp and at the ready. In this article from Harvard, 10 Hard Ball Tactics in Negotiation, it goes through scenarios and areas to avoid.

One that I found interesting was “Trying to make you flinch”. In this case, the other party keeps making harder and harder demands, waiting for you to break. I remember one negotiation I was in, the other party kept trying a variety of tactics and behaviors to make me move or waiver. I stayed the course and eventually they became more reasonable.

Personal insults and feather ruffling” is another one that makes me wonder what are they thinking? We were buying a new car and the salesman insulted us about not being able to make a decision and needing to run home to Daddy. At the time we were married with children and certainly making our own decisions. Needless to say, we did not buy the car at that dealership. I wonder how often that works? It must or they would not do it.

Everything I read about negotiation says to do your homework and be prepared. Know what your BATNA is and stick to it.

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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No Decision is a Decision

No Decision is a Decision

The Northeastern area of the United States has had a very harsh winter with heavy snow and very cold temperatures. Buildings and homes have been in danger of roof collapses due to the weight of the snow. There was a lot of communication about the issue for over a week about protecting your property and prevention activities.

Two schools about 100 miles apart were in danger of the roof collapsing. The official policy is to get three bids to select a contractor. One school followed that procedure and by the time that happened, another storm had occurred and the roof collapsed. The second school knew they did not have time to waste on the bidding process and used volunteers to get the job done.

Obviously no decision became decision. Now there is a much larger, more complex and expensive problem to solve in renovating the school.

In our professions we are often required to make difficult decisions, sometimes stretching the rules for the better good of the company. This article from Great Leadership, 8 Ways to Decisively End Indecision, gives great suggestions.

One that I have used before is “Step back and evaluate the impact of a wrong decision”. In this case, the impact was severe with damage to a public school. Other times, it won’t really matter so that is a good barometer to use.

A second pointer is “Set time bound parameters for making the call”. If you know another storm is coming, make a decision in time to get some of that snow off the roof!!

A great piece of advice I once received was “If you don’t know what to do, do something “. You can always make a course correction but you can’t do anything if you are stuck in park.

What do you utilize to make decisions? Have you found some things more effective than others?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Strategic Sourcing in Higher Education

Strategic Sourcing in Higher Education

Everyone knows that cost of college education is escalating and becoming quite a burden for families and students. Determining how to get that piece of parchment can be an economic challenge that many are finding it difficult to achieve.

Several years ago I had the opportunity to speak with someone in the procurement area at a large university. They were putting a strategic sourcing team together and implementing the supporting technology. It was refreshing to hear that the goal was to reduce overall costs and try to mitigate some of the tuition increases for students.

When I did a search on “strategic sourcing in universities “, it was encouraging to see how many had teams and processes in place. For example, Boston University has posted almost $6M in savings since 2012. They have information publicly available on who are the current suppliers, what are the procedures used in procurement and who to contact on their procurement team.

The blog this week is from Strategic Sourceror, “How are Universities using Spend Management Assets”. It begins by acknowledging the challenges faced by the colleges and universities and then reviews some of the areas benefiting them and the students through spend management.

The article highlights the importance of putting a process in place that can be used across the disciplines and departments whether it is for meal planning, housing, or the research labs. There is also the use of technology to support the process. Many of the universities have SciQuest to fill that requirement.

Do you have any exposure to procurement in the educational field, either as a student, employee or suppler? What have you found for trends in this area? How does it apply to other businesses you are involved with?

Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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A Penny Saved is a Penny Earned

A Penny Saved is a Penny Earned

One summer, I saved up all my earnings in order to buy a special bike. It was something I had wanted for a very long time and meant that most of that summer, I focused on the prize and did not spend anything without serious consideration of the consequences. I have taken very good care of that bike and still have it many years later. Certainly I was saving every earned penny!

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I am Late, I am Late, For a Very Important Date

I am Late, I am Late, For a Very Important Date

Alice in Wonderland is a classic story, written in 1865. The Rabbit is very late and is in a hurry, as seen in this short video.  Similar to the rabbit, some individuals are chronically late. Others seem to have an internal clock and they just know how long things take and walk in the door at the exact moment, or even a few minutes early. It can be frustrating when two opposites are working together, or living together.

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Dealing with Supply Chain Peaks and Valleys

Dealing with Supply Chain Peaks and Valleys

Online shopping was made for me. I do not like anything about traditional shopping (the time, the money, the effort). Therefore, online shopping is a dream: with just a few clicks, it is done! The delivery method is often by UPS and occasionally FedEx. That is how I did 90% of my holiday shopping this past year. I was in heaven!

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You find out who your friends are

You find out who your friends are

There is a country song by Tracy Lawrence, “Find out who Your Friends Are” and it describes that a real friend shows up when things are not going well. They drop everything and come to help with no questions asked.

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The party is over, now let's get down to business

The party is over, now let's get down to business

A new year is upon us and many use that as a time to revitalize their goals and establish resolutions. Very common themes are losing weight, exercising more, paying off those bills and on it goes. As a procurement professional, another resolution could be to advance your career through strengthening your skill set.


Many organizations use the calendar year as their fiscal year so that would include a new budget to be measured against. In order to meet those demands, companies often evaluate if they have the right talent and resources to accomplish those goals.

When I was reading “The Implications of 2015’s Talent Vortex” by CPO Rising, it was during a big cold snap in our region. The wind chill was up to -50F or -45C. That is cold! Certainly not conducive to keeping that resolution about exercising more!

The article discusses three areas that will assist in closing the talent gap for procurement.

  • Improved collaboration between procurement and human resources
  • Focus on analytics to help understand the complexity of information
  • Blending of the technology tools available to best get to an answer

Organizations will state “Our employees are our most important asset” and that is still the case for 2015.

What are you doing in 2015 for a resolution? Are you caught in the Talent Vortex? How is your organization working collaboratively to select and retain their “most important assets?”

 Share your thoughts by commenting below or tweeting us @BuyersMeetPoint.

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Happy Holidays from Buyers Meeting Point

Happy Holidays from Buyers Meeting Point

As another year comes to a close, and we are looking at the start of a new one, we wanted to take this opportunity to wish you and your families a healthy and happy holiday season. We have enjoyed working together on your behalf to present information that we hope you have found useful and interesting this year.

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Who is not being honest in your supply chain?

Who is not being honest in your supply chain?

There is a famous children’s story about Pinocchio. Whenever he would lie, his nose would grow longer.

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How to have happy customers

How to have happy customers

As another year comes to a close, we are often reflective of where we are and where we should be. We tend to do that both professionally and personally.

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