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Procurement Websites

Top 20 Procurement Websites http://ping.fm/wlX4F

Procurement Transformation: Which Path Are You Traveling?

Procurement Transformation: Which Path Are You Traveling? - Transformation Leadership http://ping.fm/CXA8s

Procurement and Finance Groups, Unite!

SupplyChainBrain: Procurement and Finance Groups, Unite! http://ping.fm/1RIX9

Monday Morning Wake Up Call

The Price of Knowledge

Did you ever stop to think about how much it costs when a knowledge worker leaves your organization? Lots. It’s tragic, but many organizations are just simply missing the mark when it comes to valuing the knowledge of their employees. Yet on it goes. Someone leaves the organization and is replaced; the new employee may takes months to become as productive as his/her predecessor. Or perhaps there’s a dreaded layoff and the individual is not replaced immediately. Is all that knowledge then obliterated?

Let’s try to do a bit of math. A Supply Management professional leaves the organization. A replacement is hired, let’s say at $95,000 per year (about $7,900/month). For the first month the replacement operates at 10% of effectiveness…gathering information, analyzing situations, meeting suppliers and so on. The cost to the organization is 90% of the month’s salary, that is $7,110. Month 2 is likely somewhat better, perhaps 30% effective. Then month three at 50%; month 4 at 75% and month 5 at 85%. At month 6, the new employee finally reaches 100% of the former employee (assuming no performance issues for either of them).

Here’s a graph of how that would look:

 

The cost is shown below the trend line. The total estimated cost for this model is $19,750,

Does this make sense? Think about it. Aren’t there ways to capture knowledge so that the incoming professional can come up to full productivity more quickly? We’d like your feedback.

Fred Sollish for Supply Knowledge Monday, November 2, 2009

Your Monday Morning Wake-up Call

Risk: Sorting out the Real Issues

When your organization is managing several hundred thousand suppliers, risk can become a significantly complex factor in your business, which poses the question, do we have our sights set on the real issue? Supplier solvency appears to be a common topic of concern today, so let’s examine some statistics:

For example, from 1990 to 1993 the bankruptcy rate for U.S. firms was about 1.32% of the total number of firms; it is estimated that from 2005-2008 the rate was significantly lower at 0.54% (based on data from the American Bankruptcy Institute and the U.S. Census Bureau). It’s been estimated that the rate for 2009 will rise to 1.01%, a very large increase but still well below the average for 1990-1993. Additionally, in 2008 there were 43,546 firms filing for bankruptcy; that figure is expected to rise in 2009 to just over 60,000. However, over the past 20 years, the peak in the number of bankruptcies occurred in 1991 with 71,549 firms filing and the lowest point came in 2006 with only 19,695. Yet we are in the most severe downturn since the Great Depression. While supplier insolvency needs to be a concern for us at all times, it appears the effort to focus on it in managing risk today may be somewhat misplaced.

It seems to us that the most significant risk in the procurement process is not supplier insolvency but poor scheduling and late deliveries; not always an entirely supplier generated problem. Late deliveries generally impact a schedule, manufacturing or project, causing delays and most likely additional cost. Other factors, such as poor quality, can be another component in this dilemma. However, we seem to have that under control with TQM, SPC and Six Sigma. There are always inaccurate price estimates for new products as well, and maybe difficult to control without dedicated resources to conduct thorough cost and price analysis. There are also a variety of financial, legal and human behavior risks that are impossible to predict. So the question is can we do more than just watch?

Let’s stop to think for a moment. Did anyone in procurement address the issue of risk twenty years ago? Were there any consultants or third party service providers out there offering to identify risk in a company’s supply base? In today’s society, especially with the down turn in the economy, organizations are becoming more aware of this issue at hand and are implementing a learning management system or e-learning courses into their repertoire to educate their employees on Risk management and how to identify and address the problem using methods best fit for their infrastructure in resolution.

Tell us the areas of risk you believe are the most important. Again, we have our preferences but let’s hear back from you. What is your experience and what do you typically monitor?

Fred Sollish for Supply Knowledge Monday, October 26, 2009

Procurement outsourcing spikes in recession

And while indirect spend remains the biggest focus area, "procurement outsourcing is now being tailored to include all aspects of the procurement lifecycle, from strategic sourcing and procurement operations (often extending to accounts payable) to the development and management of e-procurement platforms," says the Black Book.

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Procurement Outsourcing reduces cost of Companies

The two main objectives of procurement outsourcing is reduction in cost and tightening of focus on core competencies.

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Global Chief Procurement Officer Survey 2009

The third Global Chief Procurement Officer (CPO) Survey marks Capgemini’s continued commitment to understanding the trends and issues affecting the procurement executive. Given the seismic upheavals in the financial markets and their inevitable impact on commerce, it has never been so important to assess and understand what this means for procurement within organizations.

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A Smart Way to Save Money

When looking for ways to trim costs and maximize every dollar, procurement is an area that requires careful attention. This is, after all, where you are investing hard earned dollars for products and services that you must have to keep your organization running. That's buying everything from paper clips to professional services.

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Ten Steps to Lower Procurement Costs in Life Sciences

Regardless of the economic conditions, companies that can quickly respond and take action to stay in the game ultimately emerge as market leaders.  Now more than ever, the next generation of pharmaceutical and biotechnology leaders is being tested.  Organizations that manage their cost structures and position themselves for growth can gain significant market share as the economy improves and the U.S. healthcare reform program evolves.

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Risky Disconnect Between Purchasing and Finance

Only 28% of CFOS said they believe procurement has a significant impact on financial risk exposure.

The study of 550 financial officers in the United States and Europe was released by Basware, a developer of purchase-to-pay solutions, in conjunction with ...

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Capgemini, IBX Group team up to develop new procurement platform

Capgemini America, a subsidiary of the Capgemini Group, and IBX Group, a provider of e-purchasing services, have said that they will work together to develop a new procurement platform - deployed on Capgemini’s BPOpen technology platform.

Capgemini claims that the new procurement platform is expected to lower the cost of procurement for clients, improve the return on sourcing cost savings, and enhance visibility and control of their procurement process.

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What Makes Strategic Sourcing Strategic?

There appears to be a common misconception about Strategic Sourcing. Like many business buzzwords, the term strategic sourcing is overused. It's quite likely that most organizations, espousing their traditional procurement practices, have simply renamed the search for price savings as a "strategic " activity; a old wolf re-clothed in lambskin, as it were. It's hard to believe that an approach to procurement can be considered sexy, but I suspect that there's something of that charm for managements to declare its strategic sourcing program in a "me too" kind of way. Is that possibly a strategy of its own?

Learn more about supply knowledge http://www.supplyknowledge.com on Supply Knowledge™ website, that offers a helpful information on sourcing and procurement, and supplies of management professionals with up-to-date information and working tools.

Learn how to conduct market research to identify qualified (or qualifiable) suppliers or contractors that can meet your organization's requirements. Sign up for Supply Knowledge’s Course ( http://supplyknowledge.coggno.com/shop ).

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A "Triple-A" Supply Chain

Concepts:

supply chain, Lee, alignment, adaptability, efficiency, Triple-A, agility, demand, costs, inventory, response, firms, economy, total supply chain, printer division, short-term, differentiation, partners.

Summary:

I wonder how many of us believe that we have a real Triple-A supply chain, but instead have something more like the Triple-A ratings that Moody's and Standard and Poor's were slapping on all manner of housing-backed bonds that we now know were substantially over rated.

Something in the back of my mind during these times told me it might be time to review the classic Harvard Business Review article "The Triple-A Supply Chain," by Stanford's Dr. Hau Lee, published back in 2004.

Instead, Lee says that what matters more are three other attributes -- the "triple-A's" of agility, adaptability, and alignment.

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PO Annual Report 2009: Shifting Buyer Preferences Dictate New Engagement Models

The Procurement Outsourcing (PO) market remains on a growth trajectory, and witnessed 30% YoY growth in 2008, primarily driven by organic growth and continued buyer interest.

Everest Research Institute analysis indicates that the increase in single-process contract signing activity in 2008, coupled with higher granularity in process and category scope in PO contracts represents a shift in buyer adoption pattern.

PO Annual Report 2009: Shifting Buyer Preferences Dictate New Engagement Models

Mitigate Recession Risk and Create Competitive Advantage

What changes are they making to efficiently and strategically manage key General & Administrative (G&A) areas such as finance, IT, procurement, ...

The Hackett Group's 19th Annual Best Practices Conference

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Procurement_Turbulence.pdf (via Supply Knowledge (tm) - Recent Activity Log)

 

Supply Knowledge (tm) - Recent Activity Log

Procurement_Turbulence.pdf

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Supply Control Systems (via delicious)

 

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Supply Control Systems

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XOJet stays grounded with strong strategic sourcing

The company has a unique connection to the procurement world, as it was founded in 2006 by Paul Touw, who also founded Sunnyvale, CA.

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Ideas in Procurement Award

The Corporate Executive Board is seeking submissions for Procurement’s 2009 topic, Supply Risk Management. The Corporate Executive Board’s Force of Ideas in Procurement award annually honors innovative organizational approaches to challenges faced by Chief Procurement Officers and their direct reports.

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ICG Commerce Increases Spend Under Management

Results Underscore Trend of Fortune 1000 Companies Increasingly Looking to Procurement Outsourcing to Maximize and Accelerate Cost Reductions.

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IBM to Support Procurement for Unilever

IBM (NYSE: IBM) announced an agreement to support the transformation and ongoing management of procurement operations for Unilever Europe's ...

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Presidential Helicopter Is Procurement ‘Gone Amok’

Obama said Lockheed Martin Corp’s presidential helicopter program is “an example of the procurement process gone amok” and suggested he doesn’t need a new aircraft.

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