Spend Analysis vs. Spend Risk Management
Procurement departments should focus on value and risk, but instead they prioritize cost. Value-for-money means buying the right solution from the right supplier at the right price.
What Can Big Business Do to Help Smaller Firms?
Small and medium-sized businesses are critical players in corporate supply chains. Sometimes their participation is opaque in that they exist as undisclosed sub-contractors. The policy response to the current crisis has been to treat it as a liquidity crisis. Specifically, the shock of the Covid lockdown and its disruption to business was seen as a […]
Strategic Sourcing Is Risk Management
We live in a connected world. Personally, we’re part of families, companies, and social networks. Our organizations are tied together inextricably. We have suppliers, customers, partners, regulators, tax collectors, and communities. Everything exists in connection to nature and in the context of technology.
When Should You Use an RFP?
The proliferation of eSourcing or eProcurement systems in the last twenty years has transformed the way large organizations purchase goods and services. We were told digitization would lead to cost savings, faster cycles, better outcomes in terms of value-for-money, and the like.
Buyers Should Collaborate on Sourcing with Competitors
When we speak with procurement departments, I am always struck by the need for secrecy. They have non-disclosure agreements in place with their suppliers that prevent their suppliers from revealing anything about the relationship (including its existence).
Is Sourcing More than Cost Minimization?
In 2008, leveraged financial positions collapsed in value. Investors assumed incorrectly that American housing prices were unsinkable. Margin calls and firm failures cascaded as hidden risks emerged. Similarly, today, a black swan contagion plagues supply chains spanning multiple sectors, globally. The unexpected coronavirus revealed interconnected exposures that companies underwrote to operate lean.
Did Digital Sourcing Work during the Pandemic?
Before we jump into a report card on how digitization of sourcing performed during the Covid-19 crisis, let’s think about what a framework would look like. One way to do this is to make an analogy to another business process and extend it to purchasing.
What Is Most Important in Procurement?
It is wonderful to see people come together in these times of coronavirus-induced uncertainty to solve problems.
Primer On Procurement and RFPs
Supply chain refers to the operational part of running a business, i.e. all of the processes necessary to making and distributing the goods or services the company sells. It does not include sales and marketing. It does not include administrative work or management. It is both critical to the success of any commercial endeavor despite being discounted by managers and investors.
Coronavirus Exposes Weaknesses in Sourcing
Warren Buffett has a famous saying, “Only when the tide goes out do you discover who’s been swimming naked.”