Webinar Notes: Trends in Spend Management – Configuration vs Customization
“Any customer can have a car painted any colour that he wants so long as it is black.”
-- Henry Ford about the Model T Ford (My Life and Work (1922), p. 71)
This week’s featured webinar notes are from an April 16th webinar presented by ivalua with guest speakers from Spend Matters and HAVI Global Solutions. The event is available on demand here
.The three speakers in this webinar, Pierre Mitchell (Spend Matters), Paul Noel (ivalua), and Steve Huston (HAVI Global Solutions) all focused on the need to balance competing objectives in pursuit of ‘mass customization’. The concept of mass customization stresses the benefits of a providing a tailored offering while fully recognizing the need to leverage economies of scale to manage costs. Mitchell provided an excellent example by contrasting the Model T Ford that came in one color (hence the quote above) with Tesla’s Model S Design Studio that allows customers to select from a variety of options on their website to create the ideal car before placing an order.
For procurement, the common challenge in this spirit is balancing the efficiencies and benefits of having a standard process and common templates against the unique requirements of each effort. Procurement, along with our enabling processes and technologies, needs to be responsive to the needs of our internal customers and the specific opportunities associated with each effort. ‘Context’ is the word that I came away with from Mitchell’s portion of the presentation. Even the best solution and program need to be able to integrate seamlessly with the day-to-day processes associated with the spend in question.
Paul Noel applied this idea to the compliance needs of a supply chain in the food service industry. As product moves through the supply chain, different units of measure, processing costs, and surcharges are applied. Their combination makes it very difficult to manage costs while also ensuring consistency of quality and supply. Even from procurement’s centralized viewpoint, different skills and tools are required to store data vs. those required to disseminate it back out to the parties in the chain who need it.
Steve Huston shared his perspective on customization in the supply chain based on HAVI’s role as the force behind McDonald’s supply chain. He spoke about the need for good data hygiene, constantly scrubbing and cleansing data to improve visibility and minimize waste. Workflows and back-end processes need to be designed to be consistent with client requirements while reflecting the differences associated with each category of spend.
How much of your procurement process stays consistent and how much varies by project or category? Join the conversation by commenting below or on Twitter @BuyersMeetPoint.