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  • And now for a few words from ISM CEO Thomas Derry...

    Then I heard the interview that ISM CEO Thomas Derry gave to Jon Hansen on Blog Talk Radio. Let me tell you something, Derry is a guy with his head screwed on straight (she said respectfully). Derry clearly has a firm grasp on the changes and challenges facing procurement today despite the longevity of the organization he leads. In that interview, Derry didn’t discuss the importance of legacy or the need for established organizations in the procurement profession. He talked about what we need to do NEXT, not what we did yesterday. It was a very good interview – Derry should give interviews like it more often. But as good as it was for ISM, it was better for us: for the professionals, leaders, and commentators in the industry. We need to see that there is upside, and that the leaders of our leading organizations will be able to, well… lead, through the years and changes still to come. Here are a few of my favorite quotes from the interview, all statements made by Derry. Within ten ...

    by Kelly Barner
    Tuesday, 28 April 2015
  • What’s good for the goose… Why NIGP’s ownership is not just a public sector issue

    Anything that is considered a standard (NIGP in this case) should exist apart from competing solution providers. Imagine what it would be like if Periscope Holdings owned UNSPSC, the taxonomy commonly used in the private sector. If you run a bid to select a new eProcurement solution provider, and they don’t get the contract, are they going to pull the license from whoever did? The result is an artificial constraint to competition that does not benefit either procurement or the solution providers who serve us. In one of his posts, Jon asked the question about whether all this (presumably the negative press associated with his merciless coverage of the Periscope Holdings/BidSync story and the NIGP leadership’s reaction to it) was going to hurt customers of the combined solution. While I don’t know if there are any major downsides for those agencies/companies in the short term, there sure will be in the long term. The reason is because this goes against every guiding principle procu ...

    by Kelly Barner
    Friday, 24 April 2015
  • Social Media Intelligence for Real Procurement Professionals

      I highly encourage you to read all of the posts in their entirety, but here is a highlight from each one: Part 1: Social Media Research Essential for Supply Market Intelligence There is no question that we live in a multi-dimensional, multi-channel world. If you're doing research on a topic, should you consult YouTube, Twitter or LinkedIn? Absolutely. One of the ways I do this is to think in hashtags, or keywords. Let’s say you are a procurement person, and you've had a meeting with your stakeholders. The next step is for you to go off and start either expanding or building your knowledge of a market. Where on earth do you start? That is an opportunity to think in hashtags. You have to be able to look at your notes and see the few words that are relevant. It's a way of condensing a full page of notes down to the three or four critical elements to use in a search, and to then go off and find the associations, or the suppliers, or the regulations, or the raw materials assoc ...

    by Kelly Barner
    Thursday, 23 April 2015
  • 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 wo ...

    by Cindy Allen-Murphy
    Wednesday, 22 April 2015
  • Webinar Notes: Inventory Management in a Market-Driven World

    Unsurprisingly, forecasting is getting harder and harder to get right. Specifically, the error rates and percentages associated with demand forecasting are growing. Traditionally, there were less items being sold in higher volumes with more regular, more predictable demand. Products were also being supplied and sourced closer to the point of purchase or consumption. Cecere talked about helping companies and leaders move from demand driven supply chains and networks to market driven. So much change has taken place elsewhere in supply chain practice that inventory has been overlooked as an area for improvement. Technological innovations have improved productivity or output per employee but have done little to improve operating margin because they have not effectively tied in inventory management. And there is a correlation between inventory turns and market cap that easily justify the time and investment. She also discussed the concept of the ‘Buy Make Deliver’ team – in other words ...

    by Kelly Barner
    Friday, 17 April 2015
  • 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 bo ...

    by Cindy Allen-Murphy
    Wednesday, 15 April 2015
  • Strategic Sourceror: ‘Supply Market Intelligence for Procurement’ book is “spot on”

    On April 13, Joe Payne, Vice President of Professional Services at Source One Management Services, published his review of Supply Market Intelligence for Procurement Professionals on the Strategic Sourceror blog. You can read his full review here. The book, which I co-wrote with Cottrill Research Founder Jeanette Jones, was published by J. Ross in late 2014 and can be purchased directly from them or on Amazon. Payne, the co-author of Managing Indirect Spend with Source One’s Bill Dorn, described the take on market intelligence for procurement as “spot on,” saying, ““Supply Market Intelligence for Procurement Professionals” tackles one of the most important, yet least tangible aspects of the sourcing profession – how to get access to good, relevant information about supply markets quickly, and then maintain that information so that you have it when you need it.” You can read the other reviews of Supply Market Intelligence for Procurement Professionals, including reactions from Susan ...

    by Kelly Barner
    Tuesday, 14 April 2015
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“When you are open to share what you know with other people, good things will happen for you.” –Soheila Lunney 

Throughout the month of May, Buyers Meeting Point is covering ‘The Procurement Game Plan’ through a series of interviews with Charles Dominick and Soheila Lunney – both about our questions in response to the book and the trends they observe in supply management as a whole. Our original intent was to interview them about the book, but as we got further into conversation, we found that it was impossible to separate the content of The Procurement Game Plan from their ‘day jobs’. This book is not a retrospective look back or an encapsulation of their careers, but a snapshot from two very dynamic contributors to the procurement community. I highly recommend it as an addition to your professional library.

Our review of the book is available, and last week we shared a Q&A with both authors specifically related to our questions about the book. This week we’ll share the first half of our interview with Soheila Lunney.

SLunneyIn addition to being an author, Soheila is president of the Lunney Advisory Group, a provider of coaching and mentoring for procurement professionals in various industries to improve their processes and practices, to significantly reduce the cost of acquiring products and services, and to contribute to the bottom line profitability of their organizations.

Buyers Meeting Point: As a procurement educator and coach, what is your perspective on the typical character or personality of purchasing/procurement professionals and how well that is suited to the future requirements of the role?

Soheila Lunney: As more and more universities are offering Procurement and Supply Management courses and degrees, I see the character of procurement professionals is changing with much higher caliber individuals in various industries.  Procurement employees are truly becoming a group of professionals who are gaining the respect of top-level management.  Leaders of the organizations must support creating an environment that their procurement staff can grow, learn new and emerging best practices, and expand their horizon.  As economy is improving allocating funds to provide training for procurement staff should become a high priority for management.

 

BMP: How did a background in the pharmaceuticals industry prepare you to help procurement professionals in other industries learn to manage supply chain risk?

Soheila Lunney: While it is true that pharma may be ahead of other industries in their assessment and handling of risk potential (due in part to government regulation), industry does not matter. What matters is interaction with the outside world, while includes the health and safety of customers and associates as well as the reputation of the organization.  Whenever possible, tap into tax, legal, and treasury (for example) for their guidance. Come up with approaches that bring safety, security, and contingency plans to the organization. Keep abreast of what other organizations are doing, benchmark against them, and implement practices that can safeguard your organization against unexpected events.

 

BMP: It seems that one of the barriers to procurement having an established seat at the executive table stems from a lack of financial knowledge. Do you see that in the companies that you work with?

SL: Yes – I do see groups and individuals struggling with their lack of comfort with finance. I think it breaks down to two issues: the first is a genuine weakness with financial topics. If this is your situation, you need to acknowledge the weakness and take a class that  can satisfy your needs. The other issue looks at negotiating cost savings v. reporting those savings to the rest of the organization. The most common mistake procurement makes is reporting project savings in one big number. It is critical to itemize results as much as possible to establish procurement’s credibility by creating opportunities for explanation and demonstrating knowledge of the product/service in question.

It is also important to understand the methodologies that your finance group or controller will buy into and structure results reporting to match them. Each company or industry is different, and contract results may change over time due to M&A activity or leadership’s decisions. It is also important to make sure that multi-year contract savings hit the budget for all applicable years. This will require a joint internal effort, but will bolster procurement’s relationships with other departments.

Next Thursday we will share the rest of our interview with Soheila, and on May 31st we will finish up our series on ‘The Procurement Game Plan’ with our interview of Charles Dominick.

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