Procurement’s Missing Puzzle Piece

How can the missing puzzle piece make it easier for procurement teams to operate sustainably, improve supply chain transparency and eliminate corruption?

As procurement professionals we’re always talking about how leveraging innovative technology can add value to our organisations.

But less frequently addressed is how technology can make it easier for procurement teams to operate sustainably, improve supply chain transparency and eliminate corruption. 

In our latest Procure with Purpose webinar we’ll be exploring how the latest and greatest in technology innovations can not only help procurement pros deliver business value but also drive and enable purpose-led practice.

Join us on October 10th when we’ll discuss the tech that’s helping procurement  teams to collaborate with their suppliers and  improve transparency; how to communicate the importance of using tech to improve purpose-led procurement and why businesses must integrate tech-led purpose-driven practice into all of their decision making.

How do I register for the webinar?

Registering for The Missing Puzzle Piece: How Technology Can Empower You To Procure With Purpose couldn’t be easier (and, of course, it’s FREE!)

Click here to enter your details and confirm your attendance. We’ll send you a email with a link to the webinar platform in the run up to the event.

I’m already a member of Procurious, do I still need to register?

Yes! If you are already a member of Procurious you must still enroll to access the webinar. We’ll send you a email with a link to the webinar platform in the run up to the event.

When is it taking place?

The webinar takes place on 10th October at 10am EDT/ 3pm BST. Sign up or log in via the form above and we’ll be in touch ahead of the event to provide details on how to join the webinar live.

Help! I can’t make it to the live-stream

No problem! If you can’t make the live-stream you can catch up whenever it suits you. We’ll be making it available on Procurious soon after the event (and will be sure to send you a link) so you can listen at your leisure!

Can I ask a question?

If you’d like to ask one of our speakers a question please submit it via the Discussion Board on Procurious and we’ll do our very best to ensure it gets answered for you.

What is the Procure with Purpose community?

Procure with Purpose is a community for procurement pros who want to deliver value beyond cost savings and efficiencies – shining a light on the biggest issues from Modern Slavery to Environmental Sustainability – and on you, our members, who are already driving exponential change.

Webinar Speakers

Oliver Campbell, Director Procurement & Packaging Engineering

Oliver is a Director of Procurement & Packaging Engineering at Dell Technologies.  He has become one of the most influential thought leaders in the packaging industry by combining innovation and supply chain best practices.  Under his leadership, Dell introduced industry changing materials such as bamboo, mushroom, and molded paper pulp for more environmentally healthier packaging.

Most recently, Dell launched Ocean Plastic packaging with the aim of creating an industry response to tackle the task of the ocean plastic crisis.  Through founding NextWave, a cross-industry consortium of like-minded companies, Dell is creating a commercially viable, and scalable, supply chain that is focused on keeping plastics out of the ocean and in the circular economy.

Oliver’s accomplishments have been highlighted for their business and social influence by Fortune in their 2017 Change the World Companies, and by LinkedIn in their 2017 Top Companies to Work For.  Additionally, the 2018 Consumer Electronics Show recognized his pioneering work in Ocean Plastic with a Best of Innovation Award.  Mr. Campbell holds Bachelor and Master Engineering degrees from Cornell University and an MBA from The University of Texas.  In his free time, you can find him training for his next triathlon.

Justin Sadler Smith, Head of United Kingdom & Ireland, Ariba Cloud Procurement at SAP Ariba

Justin Sadler-Smith is head of SAP Ariba UK and Ireland, procurement and supply chain thought leader, and cognitive procurement ambassador. He is one of a growing number of procurement leaders around the world who helps procurement and supply-chain teams ensure that fair labor practices are in play across their global supply chains by harnessing innovative technology and increasing competitive advantage

Padmini Ranganathan, Global Vice President – SAP Ariba

Padmini Ranganathan is Vice President, Products and Innovation for Supplier Risk, Compliance and Sustainability solutions for SAP Ariba.  In this role, she is responsible for product strategy and engineering and leads a team of experts focused on delivering solutions that enable risk-aware, sustainable and ethical supply chains.

Prior to SAP Ariba, Padmini led the Analytics for Industries solutions marketing team at SAP which brought to market the first analytical applications and content for “art of the possible”  industry and line of business application scenarios. Before joining SAP, Padmini worked at Oracle, where she was part of the procurement product management team that delivered the first web-based, self-service applications for procurement and a technical consultant in the areas of order management, inventory & distribution, procurement and manufacturing.

Padmini is a passionate advocate for bringing technology to business users that simplifies and enriches their daily work and decision making. And as the Products & Innovation lead for SAP Ariba’s Procurement with Purpose initiatives, she is dedicated to helping businesses balance their costs with conscience and make an impact on the larger world.

Padmini has a post-graduate diploma in computer science from UC Berkeley, California, and a bachelor’s degree in commerce with a major in Cost & Management Accounting from Bangalore University, India.

Sign up for The Missing Puzzle Piece: How Technology Can Empower You To Procure With Purpose ahead of 10th October. 

The Three Pillars of Procurement Risk Management Strategy

What are the three essential factors for  effectively addressing the shifting conditions of sustainability risks and opportunities?

rawf8 / Shutterstock

This year has provided plenty of examples of why organisations need to better manage or participate in more effective sustainability and CSR initiatives to better manage risk, and purchasing and supply chain managers are finding themselves at the forefront of these initiatives, as keepers of the risk management keys. While hot button issues like worker safety and reputation risk are only increasing in importance, transparency and sustainability are reshaping consumer demand, and intelligence trumps data in supply chain risk management.

Luckily , this  emphasis on sustainability and CSR is breathing new life into purchasing and supply chain teams, giving them a renewed sense of urgency to establish  or expand supplier assessment programs and position themselves as greater strategic assets to their organisations and industries.

After reflecting on the variety of new supplier sustainability programs EcoVadis has helped launch or evolve, our experts have discovered three key factors as essential for effectively addressing the shifting conditions of sustainability risks and opportunities.

1. Program Reach and Depth

When setting up a supplier monitoring system, the assessment methodology should cover all key themes in sustainability and Corporate Social Responsibility. It’s common for homegrown or initial assessment programs to start by tackling just one issue, like environmental sustainability or human trafficking. To truly have an impact and effectively manage risk, however, the system should cover criteria across environment, labor and human rights, ethics/anti-corruption, and the supplier’s own sustainable sourcing practices.

Geography is also a significant factor when designing and implementing a program. Most modern supply chains span over 100 countries, so the assessment methodology should be appropriately adapted to cover this spread, engaging and supporting suppliers in local language wherever possible and taking into consideration variances in regulations and culture, at least for the top regions.

Finally, the size of the suppliers/third parties you are working with is another important dimension to examine. Many of them will be small- or medium-sized enterprises (SMEs) that are not listed on any stock exchange, and with little required reporting or public information. The monitoring system and methodology should be adapted accordingly to measure these SMEs.

2. Seamless Integration: Change Management and Processes

To make sure your teams and partners have the best chance of success with a new or changing sustainability and CSR initiatives, the methodology and processes used to both collect data and adopt performance indicators must be integrated into current, familiar processes and workflows.

There are two elements to this:

Change management

It is essential that the supplier sustainability monitoring solution vendor be able to support you and your team in the required change management program that will drive adoption of the initiative. This could include consulting on strategy and rollout, program branding, communications and supporting content development, training, support/helpdesk, onboarding services and reporting.

System and process integration

A key enabler to maximizing the impact of sustainability criteria on purchasing behavior is to integrate the assessment system into the current supply chain management platforms such as e-Sourcing, e-Procurement, CLM, SRM or similar platforms.Supplier monitoring solutions that come with an API that can be used to integrate the CSR indicators to other platforms are a huge advantage here. This way, you can give buyers and category managers access to current and complete sustainability data within the tools they are using today.  

For a deeper dive into these criteria and checklists, get this free Ebook covering “Five Essential Criteria For Selecting A Supplier Sustainability & Risk Monitoring Solution.”

3. Creating Measurable Value

No matter how thorough or amazing the assessment solution, it will only be effective with supplier participation. Here are a couple key ways sustainability monitoring programs can provide value to suppliers, which is vital to engagement and the ultimate success or failure of the initiative:

Alignment with relevant labels, certifications and standards

Suppliers will always care about compliance and a core feature of any monitoring system is to ensure suppliers adhere to the relevant global, regional and/or category-specific labels, certifications or standards. Examples might include FSC for fiber-based products, REACH registration of chemicals in Europe, or EnergyStar for appliance makers in North America, and so on. There are thousands of such labels, certifications and standards across the 120+ countries touched by global supply chains. A comprehensive supplier assessment program must take into account all  relevant assessments and maintain an annually updated list in each major region/country. In doing so, suppliers can ensure that their efforts are “valorized” in the monitoring process, making it more efficient for them to participate.

Actionable results, benchmarks and feedback

The results of a sustainability assessment should be digestible and actionable by both the buyer’s side (procurement and supply chain, EHS&S, risk), but also for the supplier.  Visually exhausting spreadsheets of checkmarks, or a list of documents from a supplier is often hard to understand and thus not actionable by a purchasing or category manager. These roles want instead to understand how suppliers’ sustainability performance compare to their peers and what the norm for the industry or geography is. Also, being able to also clearly understand performance over time is another vital part of any system. Solutions that make the short list should provide actionable results and indicators, benchmarks for comparing performance, and feedback on areas of improvement.

Continue reading The Three Pillars of Procurement Risk Management Strategy

Your Supply Chain Career: Accelerated

What do supply chain leaders predict for the future of the profession and how do you ensure you’re prepared seize the opportunities and get the most out of your career?

What is the biggest mistake supply chain professionals make?

What are the five key skills you need to make it to the top?

How should supply chain leaders embark on a major transformation?

Will the profession evolve in the coming years in preparation for an AI-enabled world?

We’ll answer all of these questions and more when Career Boot Camp 2018 kicks off at the beginning of October.

This year’s series, Your Supply Chain Career: Accelerated, has been designed to help you sprint outside of your comfort zone and get into the best career shape of your life!

Featuring tips and tricks from some of the best in the business we’ll be discussing how to make it as a Head of Supply Chain, the true value of professional certifications, how to persevere in the face of adversity and what the future holds for the profession.

Sign up here ahead of our launch on October 1st.

FAQs

What is the Procurious Career Boot Camp ?

Procurious’ Career Boot Camp, sponsored by IBM, is a global professional development event for supply chain professionals. The series, features five, fifteen-minute podcasts that have been designed to help you get into the best career shape of your life.

How do I listen to the Career Boot Camp podcasts?

Simply sign up here and you’ll be re-directed to the Supply Chain Pros group where you can access all five podcasts. You will also join a mailing list, which will alert you each time a new podcast is released.

How will I know when each podcast is published?

The series will run for one week, starting on October 1st, with a daily podcast released on Procurious each day. We’ll drop you an email to let you know as each podcast becomes available.

Is the podcast series available to anyone?

Absolutely! Anyone & everyone can access the podcasts and it won’t cost you a penny to do so. Simply sign up here!

When does Career Boot Camp take place?

Starting on the 1st October, Career Boot Camp will run for five days. The podcasts will be accompanied by daily blogs from our Supply Chain Career Coaches plus group discussions and articles on Procurious. When the series is complete, all five podcasts will be available for registrants via the Procurious eLearning hub, FREE of charge.

Why should I do Career Boot Camp every day?

Dedicating 15 minutes a day to developing and progressing your supply chain career can make the difference between standing still, or sprinting quickly into more impactful roles. At Procurious, we firmly believe that daily procurement learning is essential for career advancement. And Career Boot Camp will help you get into the habit!

Speakers

Rick Blasgen, CEO & President – CSCMP

Rick D. Blasgen has been the president and chief executive officer of the Council of Supply Chain Management Professionals (CSCMP) in Lombard, Illinois, USA since 2005.

Rick Blasgen has responsibility for the overall business operations and strategic plan of the organisation. His efforts support CSCMP’s mission of leading the supply chain management profession through the development and dissemination of supply chain education and research

Ron Castro , Vice President – IBM Supply Chain

IBM Supply Chain Vice President leading a remarkable team through the digital and cognitive journey to an end to end AI-enabled supply chain. Driving adoption of cutting-edge technology and applications inside and outside of the manufacturing walls.

Chris Crozier, Chief Digital Officer – Orica

Chris Crozier is the Chief Digital Officer for Orica International, the world’s largest manufacturer and supplier of explosives for mining and civil construction. In this capacity, Chris’ digital teams supports the global footprint of the organisation across Business, Customer and Manufacturing systems, including governance of Orica’s digital ecosystems, architecture, data and cyber posture. Prior to this, he has held executive roles within Orica as Global Vice President Supply Chain, and BHP Billiton.

Tom Evans, UK Ultramarathon Runner

Tom Evans is a 26 year old professional Trail Runner and Red Bull athlete. In 2017 he discovered ultra running and finished 3rd in the famous Marathon des Sables, which was his first ultra marathon. Since then, he has become a full time athlete. He finished 3rd in the Trail running world championships while representing Team GB. He has recently won the CCC – one of the most prestigious 100km mountain races”

Samantha Gash, Australian Ultramarathon Runner

Samantha Gash, as a World Vision Ambassador, ran 3253 km in 76 days across India, raising over $150,000 to fund education programs. Her other achievements include a 1968km expedition run along South Africa’s Freedom Trail and four 250km desert ultramarathons as part of the Racing the Planet – Four Deserts Grand Slam.

Laura Faulkner, Director Supply Chain Management – Nationwide Building Society 

After graduating from Strathclyde University with a BSc in Technology & Business, Laura joined Polaroid as a Graduate Buyer. Laura then spent time with GSK and Ernst & Young before taking a role with RBS that led to her being appointed CPO in 2014.

Laura is now CPO and Director of Supply Chain Management (SCM) at Nationwide Building Society where she has brought together Procurement, Property Services, Third Party Risk, Vendor Management, Accounts Payable and Offshore Operations.

SCM’skey focus is to maximise the value of 3rd Party Relationships across the Society, leading the Supply Chain Strategy to drive efficient, resilient and innovative solutions for the benefit of all Nationwide Members.

Career Boot Camp, Your Supply Chain Career: Accelerated kicks off on October 1st 2018. Sign up here (it’s FREE!)

10 Reasons Why You Should Be A Mentor

Mentoring is quickly gaining recognition as one of the fastest ways to develop talent and accelerate leadership potential. Here are 10 reasons why you should be a mentor…

  • Have you ever considered being a mentor?
  • Do you have a mentor?

These are just two of the questions that are starting to be commonly asked in leadership circles as more people recognise the value of mentorship. Both from the perspective of being a mentor, and the perspective of having a mentor.

Mentoring is quickly gaining recognition as one of the fastest ways to develop talent and accelerate leadership potential. What people are also recognising is the value and development that comes with being a mentor.

So here are 10 reasons why you should be a mentor:

  1. You are supporting a future leader

Seeing a leader developing their skills and knowledge first hand, and knowing that you have played a part in this, can be incredibly satisfying. There is a sense of leaving a legacy and fulfillment when you reflect on what you have given to your mentee.

2. You develop your communication and coaching skills

Your improved skills will allow you as a leader to communicate more effectively with the team in your workforce, making it easier to influence your team. It is important to recognise that not everyone is able to immediately step into the role of mentor. Being an expert in your technical field is one thing, being a mentor is something very different.

3. You build networks and become part of the mentoring community

Relationships are a key to your success in business and your network is a powerful resource as it allows you to share information, insights and provide support. The mentoring community is growing as more and more leaders recognise its value.

4. You gain insights into other industries

There can be incredible learning opportunities when you mentor someone from outside your own industry and you will pick up the nuances of that sector. It is very easy to fall into the trap of always looking at things through the lens of your experience and perspective. There is much value to be head from taking a wider view.

5. You are encouraged to practise solutions-based thinking

All leaders need to be able to understand business challenges as this allows them to make solid business decisions. Understand the problem, then spend more time focused on the solution. The practice of solutions-based thinking is a discipline you will be able to take back into your own leadership and own workplace.

6. Mentoring brings business opportunities

It may be that your mentee brings opportunities to you, or you may simply spot the opportunity as a result of the relationship. Depending how active you are on social media, opportunities might also present themselves as you share your insights along the mentoring journey.

7. Mentoring increases your credibility as a leader

Being a mentor can actually increase your credibility as a leader because it demonstrates that you have the ability to develop others. Employers are looking for leaders who can develop other leaders as succession planning becomes more of a challenge for organisations as expectations grow about career opportunities.

8. Being a mentor becomes a sellable skill

Having your mentoring experience on your resume can add to your leadership credibility, especially if you have been mentoring for a number of years. Leaders who are serious about their careers and recognise the value an external mentor can bring. The value comes in the form of a clear perspective because they are not working for the same employer.

9. Leaders who mentor leave a legacy

As a mentor, it is important to consider the legacy you will leave. You can have a lasting impact on people which goes beyond their working life. This is actually one of the most fulfilling aspects of being a mentor because sometimes just knowing the small contribution you have made to the life of another person is incredibly rewarding.

10. Mentoring gives you opportunities for self-reflection

As you work with your mentee on their career path, their career challenges and anything else which may arise, you will find yourself contemplating your own leadership journey. This can be a powerful experience as you will undoubtedly find lessons in your own development which can, of course, be shared with your mentee.

Mentoring is more than just a fancy word for supporting someone else.

It is a commitment of time and effort that is rewarding and provides a sense of fulfillment that goes beyond leadership and management. It is knowing that you have made an impact on your mentee whilst at the same time undertaking some valuable self reflection, which can only have positive outcomes for your own leadership.

Being a mentor is an idea that I believe all leaders should subscribe to and I imagine what the state of leadership might be like if this were the case.

My book Give Back. Lead Forward: Why every leader should be a mentor and have a mentor is published by Major Street Publishing and is available in all good bookshops and online.

How to Keep the Supplier Love Alive

We take a look at some of the ways procurement professionals should manage, and negotiate with, their long-term suppliers when things get tricky…

Nobody said it was going to be easy. Building and, most importantly, maintaining good supplier relationships takes hard work, commitment and focus. And the longer they last, the more they require this careful nurturing to keep the love alive and the flame burning.

But what happens when one half of the partnership doesn’t hold up their end of the deal; taking advantage of a long-term contract or a presumed arrangement which has started to have a negative impact on your organisation?

What do you do when a change of circumstance means you want to re-negotiate your terms?

How do you get yourself out of an undesirable, self-destructive partnership when to change things up could be costly and difficult to implement?

We joined a recent Negotiation Roundtable organized by CABL (Conti Advanced Business Learning), a firm that specialises in Negotiation & Influencing, on the topic of long-term negotiations. We wanted to hear advice from a number of procurement and sales leaders on how to manage those long term supplier relationships.

Giuseppe Conti, the founder of CABL, introduced the subject by highlighting that in long-term relationships there is a risk that one of the two parties take advantage of the situation. He then led the group to discuss a number of different ways for procurement professionals to manage, and negotiate with, suppliers when things get tricky.

Look below the iceberg

 For procurement professionals, this is a tale as old as time – how do you manage a supplier who increases prices without warning, when you were under the impression that you had a long-term agreement. Do you cut and run?

“That depends entirely” argues Laurence Pérot, Global Supply Chain Procurement Head at Logitech, “on the nature and origin of your relationship with that supplier.

“You need to consider how you selected them in the first place. Was there a good cultural fit, what drew your organisation to them? Cost reduction is just the tip of the iceberg.”.

According to Xinjian Carlier Fu, Sourcing Leader at Honeywell, “If you can satisfy all the elements beneath the surface (i.e. risk reduction, security, protecting margins and personal requirements) you will have a much more effective negotiation.”

Believe that you have the power

 It’s easy to be intimidated by suppliers who seem to be calling all the shots in your relationship. Xinjian Carlier Fu believes it’s important to have confidence in your own procurement power. “Don’t be afraid of [your supplier] relationship. They might seem dominating and intimidating but I like to use the analogy of David and Goliath.

“Procurement professionals should think of themselves as David. Don’t underestimate your influence or give up hope for your organisation.  You do have negotiation power. Don’t give up hope.”

“Unfortunately not every supplier is willing to work with you in a partnership. Sometimes not all parties are considered equal,” explains Guillaume Leopold, Former CPO at Coty.

Look for a win-win

Ifti Ahmed, Managing Partner at Titanium Partners, described that tricky situation of inheriting an existing supplier when starting a new procurement job. “This particular supplier wasn’t my first choice but it became my job to manage the negotiations and the budget. I did look for alternatives, of which none were suitable and so I did feel like I was in a tough position from a negotiations perspective. ”

“But we prepared well for these negotiations, ensured we had a greater idea of what they valued; what was annoying for them and what they wanted from the partnership, so we were able to discuss points for improvement on both sides and the new contract ended up as a win-win”

Giuseppe Conti also highlighted the importance of using partnership tools to effectively manage the supplier. This includes a Service Level Agreement with KPIs for both parties, performance reviews, alignment of senior management teams, bonus system, audits, 360-degree feedback. 

Make your position clear

It’s very difficult to build trust in your supplier relationships when staff turnover is high. Indeed, as Alessandra Silvano, Global Category Director CAPEX & MRO at Carlsberg, pointed out “many suppliers try to take advantage of frequent rotations in the workforce. But they need to know that you are aligned. Pricing should be treated in the same standardised way, not matter who you are working with.”

Work at it like a marriage

Regina Roos, VP & Sales Segment Leader Mineral and Mining at Schneider Electric, recommends you approach your supplier relationships like a marriage. “It’s not a one off event. There are levels of commitment and you have to keep working at it. If you’re not prepared and you don’t know what you’re getting into with a supplier it’s your fault. You need to make a commitment, and stick to it.”

Paul André, Director Reduced Risk Commercial Supply at JTI, agrees, arguing that “you need to be very clear on what you’re entering into – and that you don’t have a different expectation of the relationship you are building.”

Get to the crux of the problem

What should procurement professionals do when faced with a seemingly irrational supplier who simply won’t re-negotiate terms or agreements? Xinjian Carlier Fu suggests that you “try to identify the motivations underlying these actions or attitudes. Think about the possible constraints they might be facing. Then test your theories by asking questions – ‘Are you facing pressure to cut costs?’” When you understand what’s driving the supplier’s behaviour, you’ll find it easier to come to an agreement.

Work with suppliers you like

The value of supplier likeability is not to be underestimated according to Francesco Lucchetta, Director EMEAI Supply at Pentair. “Taking company culture into account is so important when it comes to selecting suppliers, particularly if you’re forming a long-term agreement. People are very different and to work with people you like is a really good thing. When the culture is unfriendly it’s hard to build trust in the relationship.”

For more advice on managing your supplier negotiations, check out the first blog in this two-part series – 6 Ways To Prevent A Negotiation Blow Up.

Procurement is Already Awesome – Here’s Why So Many #LOVEPROCUREMENT

It’s becoming increasingly apparent that procurement professionals love what they do. And here’s why….

We have all seen how far Procurement has evolved in recent years. The process has certainly not been easy for some; most of us are still on the journey (after all, transformation isn’t a destination) and others have yet to begin. But one thing is clear, procurement has turned the transformation corner and is speeding forward.

It’s not long ago that procurement departments were shunned and dismissed as merely back office administrators. But a lot has changed and the new terminology used to describe procurement is hardly recognisable; collaborative, innovative, data-driven, agile, change agent, advisor. Much of this due is to the broader realisation that Procurement can add significant value to an organisation. But to me, there is even more to it. I believe that the passion that many procurement professionals have for their work and the fact that many of us love what we do plays a big part.

Over the last year, and before that as an industry analyst, I spent a lot of time listening and talking to procurement professionals and it became apparent that people in this function really do enjoy and love what they do. It may have something to do with the fact that procurement is now exciting and invigorated but regardless, I wanted to investigate further. So, at our annual event we asked real procurement practitioners one question “Why do you love procurement?” and the response was overwhelming and quite frankly, surprising. We received over 120 answers, many of which expressed a great passion and  love for procurement. This was enough evidence for me.

The response was so great that we felt obligated to share a few, in the hope that they:

  • Inspire those in this profession (and maybe others)
  • Show that this is not your parent’s procurement; this is a dynamic, modern and challenging profession
  • Prove that many procurement professionals are excited about their roles, what’s in store for them and the impact they can have on an organisation
  • Drive even more proclamations of procurement love (you can submit your own by clicking on the image below)

I couldn’t help myself, so I threw all the responses into a word cloud tool to highlight some of the most common words used:

Why do you love Procurement?

Above are some of the main words used to describe why people love Procurement but here are some actual responses. To see more please visit this page

My favorite one really captures the dynamic nature of Procurement and the impact:

“It gives me that spiderman feeling- middle of the web with the other players and a superhero when we get the cost out.”

Procurement is about relationship building.

“I do not source goods and services, I source relationships.”

Procurement is fun…

“Involves cost, saving, buying, innovation, suppliers and all the fun in the world.”

Who said Procurement doesn’t care about suppliers?

“I love helping suppliers innovate develop and succeed”

Procurement helps make businesses more agile.

“I’m ready to fully respond and support continuous and radial changes in a business.”

Procurement is an exciting place to be right now. It’s a dynamic function that demands a multitude of skills from the traditional negotiation, relationship management and process skills to the increasingly important sales, communication, analytics, innovative technology and more. Many procurement groups are having to familiarise themselves with emerging technologies such as AI, blockchain and IoT. The rapid innovation in these areas and potential impact means that procurement must keep pace.

Procurement is a gatekeeper to potentially the largest source of innovation any company has – its suppliers. Fostering those relationships, building new ones and becoming the customer of choice is critical in this hyper-competitive age.

All of this makes Procurement fascinating. As such, we will continue gathering these quotes from around the world and hopefully generate more interest and excitement about Procurement.

So, if you #LOVEPROCUREMENT, tell us why.

Teeing Up For AI in Procurement: It’s All About One Thing…

The benefit of AI for procurement is clear – the question, then, is what will it take to effectively put it to use?

Over the last year, machine learning and artificial intelligence (AI) technologies have graduated from the class of “emerging tech” – they’re here now, they’re increasingly sophisticated, and their adoption will only continue to accelerate.

We’ve seen machine learning and AI go mainstream in consumer tech environments, and they are rapidly shifting from hype to reality in enterprise environments as well; however, enterprise executives are still working to understand how AI applications can move beyond specific product features to influence broader business functions and strategies.

Let’s take a look at the procurement department, for instance. Procurement and purchasing professionals have a lot to gain from leveraging AI. In fact, AI has the potential to completely transform how organisations manage their spend, from automating invoice coding based on learned criteria, to predicting potentially fraudulent transactions, and preventing rogue spending before it happens.

The benefit of AI for procurement is clear – the question, then, is what will it take to effectively put it to use?

Gartner’s report, “Start Preparing Now for the Impact of AI on Procurement,” states that “technologies’ need for data will force application leaders in procurement to ensure access to the necessary internal and external data sources.”

Essentially, the first step to getting predictions out of AI is to capture all data – internal data, external data and third-party, public data. Furthermore, procurement professionals should be asking themselves if they have the volume, the quality and the completeness of data needed to leverage AI within their department.

Ticking each of these boxes can feel like an arduous process, but a good starting point is to hone in on three particular sources of data that provide the greatest visibility into spend:

1. Supplier Data: This means capturing data from 100 per cent of suppliers in the procurement system. Not just the largest multi-national suppliers who use sophisticated EDI or XML formats, but the whole tail. This should include mid-tier suppliers that may be using online portals or emailing PDF invoices, all the way down to the smallest “mom and pop” businesses, who continue sending paper invoices. Using an open commerce network that accepts and supports all invoice formats and requires no changes on the supplier’s end enables 100 per cent supplier onboarding and captures all transactional data. To gain true visibility and power future platforms, procurement and finance leaders must aggregate as much financial data as possible beginning with supplier data.

2. User-Driven Data: The ability to capture user-driven data–specifically, buying insights that track 100 per cent of all purchasing requests that run through the system, is vital. Visibility into employee spend ultimately depends on how user-centric procurement tools, technologies, and processes are designed. The bottom line is: procurement systems shouldn’t be designed for the procurement department. They should be catered to potentially thousands of employees around the world that are buying things in their organisation.

Searching for orders, dynamic routing and approvals, and guided buying, for instance, should be easy to navigate and fit seamlessly into the way employees already work. The key is to create a system that users adhere to not because they have to, but because it’s the easiest way to get what they want from preferred vendors at the negotiated price, providing another layer of spend visibility.

3. Invoice Data. By nature, the accounts payable function is primed for intelligent automation. There is a huge opportunity to use AI for things like improving processing efficiencies and reducing costs, increasing discounts and eliminating late payment fees, for instance.

But, these enhancements can only be achieved if the invoice data feeding into AI is complete. That means procurement needs to capture 100 per cent of invoices, irrespective of format (paper, PDF, electronic) and irrespective of invoice type (PO-based, non-PO based, invoices for direct spend, for indirect spend, for facilities and utilities, etc) –  truly, any and all. Whatever the invoice, it should be captured.

These three particular sources of data can truly position a company to take advantage of all the benefits AI promises just over the horizon. Elements of machine learning, AI and predictive analytics already exist within procurement today. Forecasting budgets for approvers, alternative cost-effective suggestions during a user’s shopping experience and intelligently aggregating POs based on purchase trends are just a few commonplace applications. But to take advantage of any of these applications, and future opportunities to gain a competitive advantage, data is an absolute prerequisite. Only when armed with data – especially from suppliers, users and invoices – can procurement make the most of their investment in AI technology, enhance spend visibility and optimisation, and ultimately, boost the organisation’s bottom line.

Continue reading Teeing Up For AI in Procurement: It’s All About One Thing…

Tuesdays With Tom: Trump, Trade and Turning Disruption into Opportunity

Institute for Supply Management CEO Tom Derry compares the Trump administration’s trade policies to “self-inflicted friendly fire” in the first of our 10-part Tuesdays with Tom podcast series.

“In military conflicts, one of the outcomes we most dread are instances of ‘friendly fire’, when you mistakenly fire on your own troops. I think the current [trade] policy is almost an instance of self-inflicted friendly fire, from an economic perspective. We might be helping domestic industries like steel and aluminum (although even that’s arguable), but we’re actually damaging the far bigger industries that are consumers of those products; who make household appliances, yellow goods for construction, or automobiles. All of our exports in those areas will suffer with this trade policy.”

In the first of our Tuesdays with Tom podcast series, ISM CEO Tom Derry talks with Procurious Founder Tania Seary about the current raft of trade wars and tariffs that have come about as a result of US policy shift.

Supply management professionals do NOT like trade wars

“ISM publishes economic reports every month for the manufacturing and services sector. Comments have been very consistent: we’re seeing suppliers trying to impose price increases on buyers as they’re buying metals (such as steel and aluminum)”, says Tom. “We’re seeing people anticipating the tariffs, looking to end sourcing from China and look for suppliers elsewhere, and we’re seeing people postpone investments.

“The two most important economic factors in deciding where to locate a manufacturing facility are local taxes and tariffs. If tariffs are uncertain, [companies are] going to postpone decisions about building that next facility, which is not good for the economy in the long run.”

NAFTA renegotiations having an impact

“What’s so interesting about these policy changes”, says Tom, “is that even mere discussion has a real economic impact and causes real dislocation of supply chains. Even before the steel tariffs were imposed, people reacted to the idea of tariffs, and that caused businesses to have to change their plans.”

Historically, NAFTA has resulted in incredibly tightly integrated supply chains in certain industries, particularly the automotive industry. “We do a lot of assembly of automotive in northern Mexico for final sales here in the United States or in Canada, but before you get to that final assembly in those plants, you’ve got components for parts that move across the Mexican/US border four or five times before we get to the final vehicle”, says Tom.

“Imagine what it would be like to impose tariffs in both directions four or five times, and the inspections that would have to go with it, and the country of origin verification that would have to be performed. If NAFTA [fails], it’ll be incredibly disruptive in terms of the auto industry here in North America.” 

Two tips for turning disruption into opportunity

  1. Have a Plan B: “Every good category manger has a Strategy A for expected economic conditions, and Strategy B if there’s an economic downturn or something happens in the commodity markets. You have to have those playbooks thought through and scripted … if you haven’t done that, get to work on that immediately.”
  2. Be prepared to react fast: “If you see a dramatic change, you need to be able to respond to it in the moment. The advantage goes to the company, the organisation, or the individual who can react fastest during times of great change. If you’re late in moving, any potential benefit to be realised will be captured by someone else. Make sure you’ve got that playbook well defined.”

“The advantage goes to the company, the organisation, or the individual who can react fastest during times of great change.”

Tom tells the story of a CPO working at LG Electronics during the 2008-9 recession, who was concerned about securing semiconductors. They were aware that a recession would lead to a drop in consumer demand for electronics and hence a demand for semiconductor chips, so he visited his suppliers in Asia, then managed to convince his executive committee to buy $9 billion worth of semiconductors because the price would never be as low again. LG subsequently posted record profits for 2009 due to that CPO’s business acumen, his understanding of the spot market for semiconductors, and doing his homework. This is how you respond to disruptive events.

“[Procurement needs to] see through the common perception, recognise market opportunities and the dislocation between price and demand, and seize opportunities to turn a perceived threat into a great opportunity for a huge bottom line impact.”


Tuesdays with Tom is a 10-part podcast series featuring exclusive insights from ISM CEO, Tom Derry. Register now to receive an alert whenever a new podcast is released.

Is AI Doing Your Head In?

Seven tips for making headway with your cognitive sourcing project.

I will never forget visiting the Smithsonian National Air & Space Museum in Washington for the first time 30 years ago and seeing the Apollo capsule. Like so many others, I was amazed at how basic the technology was that took us to the moon.  I remember saying to my travel buddy, “Hey, this looks like my 1969 Toyota Corolla!” (my first car). Of course, back then, that was the very latest technology when humanity had its first “moonshot” opportunity.

My point here is that as procurement professionals, we may be sporting 30, 40 or 50-year-old hardware (our bodies!), but we need to make sure we are using 2018 software (our brains and capabilities) to get the very latest technology embedded in our organisations.

I mean, if cognitive is here, and it’s our moonshot opportunity to change the trajectory of the profession and there’s millions of dollars waiting to be saved, we don’t want to be left back on the rocket staging launch pad as an observer!

The challenge for all of us is to determine whether and how we implement this hot new capability.

Step one is to be clear about your corporate drivers. In my experience, companies are always going through one of six phases (please note the “status quo” is never one of them). Sometimes, they are going through multiple phases at the same time!

These directions are set from the top… hard coded. So if you want to get your cognitive sourcing project off the ground, you are going to have make sure your project aligns with one of these corporate objectives.

One of the key movers in the space, LevaData, is offering a hard ROI of 10 to 30% incremental cost savings, guaranteed. I asked them how we could link cognitive projects into the generic 6 corporate phases and this is what they had to say :-

  • Efficiency – massively reduce manual data validation, spend analysis, and sourcing event preparation activities
  • Compliance – engage approved vendors and qualified alternate sources of supply through auditable RFX process (vs. email and spreadsheets)
  • Transformation – elevate procurement and strategic sourcing as internal orchestrators, working cross functionally with engineering, finance, manufacturing, and sales to managing emerging supply risks and opportunities
  • Innovation – accelerate new product introduction and optimize cost and risk through the product life-cycle
  • Cost-down – improved negotiation insights lead to sustainable cost management year over year, capturing cost reduction opportunities as well as minimizing cost inflation risks
  • Growth – enable scaleability and responsiveness to forecast and market changes from months to weeks or days.

Getting BIG, innovative ideas and game-changing concepts through BIG Companies is not easy.  To successfully land cognitive technology in your organisation, you’ll need to:

1. Have courage and commit yourself. It’s important to have full confidence in your cognitive project and be prepared to put your credibility on the line and stand up for it at all costs. Once you’ve decided that it’s worth committing to, give it everything and don’t give up.

2. Do your homework.Make sure your cognitive sourcing project is closely aligned with a key corporate objective. Collect and scrutinise the data on the benefits of introducing cognitive and make sure your business case is bullet-proof. You need hard-nose, quantifiable benefits to support investing in the cognitive project and these numbers need to be backed up by the people who count (predominantly operations and finance).  Do your pre-work, build your support team. As you work your way around the organisation convincing people of the need to change, refer to your support network often: “Johnny in finance is firmly behind this, he helped me with the numbers”.

3. Think Big, Act Small, Accelerate Fast. Keeping the vision in mind, find a small representative project, experiment and demonstrate the ROI with Cognitive capability. Sell the outcome and accelerate fast. I would encourage you to think about what that project might look like and figure out ways to get it off the ground.

4. Pick a sponsor (carefully!). Think carefully about who would be the best sponsor for your cognitive sourcing project.  Make sure they have power and influence – and make sure they are supporting you for the right reasons and believe the project is important for the business. Try to avoid sponsors who are purely supporting cognitive for their own career advancement (I know this is hard to uncover at the outset). This is because your project will be dumped as quickly as it was taken up if it suddenly falls out of favour – which is another reason to make sure your project is aligned to key, quantifiable business objectives.

ONLY refer back to your sponsor when you reach a critical deadlock at an important milestone.  “Keep your powder dry” throughout the project, otherwise you will be too much of a drain on their time.  You need to make it easy for them to be your sponsor. Bring them in for the photo opportunities and the critical decision points.

5. Create a support network. I’ve often said procurement can be a lonely place, because you may be the only person in your company, or even in your industry, doing what you do! That’s one of the many reasons why I started Procurious, to help people connect and learn from each other.

Procurious is the perfect place for reaching out to others leading the cognitive journey within their own organisations. Over five thousand Procurious members visit our discussion board every month to share ideas and offer advice to their peers. Our blogs are read by thousands of professionals daily and spark debate, with members feeding their own commentary and ideas into the global community.

Our digital Big Ideas Summits, along with all the other networking, discussion and eLearning on the site, inspire a global generation of procurement leaders and business intrapreneurs, challenging them to take a more innovative professional approach.

Your network is also a powerful tool for endorsing what you are recommending, for example you can refer to your network – “I know Janie at ABC company (our competitor) and they are already implementing cognitive”.

6. Be human(!) in all your interactions. Up, down, and across the supply chain, it will be interactions between people that will be the real determinants of success and failure in an increasingly robotic era. To prosper in this next Industrial Revolution, we need to play to our human strengths – collaboration, connection, innovation, influence – the things only we humans can do.

7. When you get knocked down, get back up again. If you’re going to succeed in getting your big idea through a big company, you have to be incredibly resilient. You will have nay-sayers telling you why cognitive is not going to work, so keep going back to the data that demonstrates how this will support the business objectives. That is your strongest defence.

So, like any other project that is doing your head in, the implementation of cognitive can best be tackled by breaking it down into distinct steps. It’s going to take grit and more than a little determination, but the potential rewards are stratospheric.

Tania Seary will deliver the closing keynote at LevaData’s Cognitive Sourcing Summit on 13th September 2018 in Santa Clara, CA. Find out more.

Four Ways To Cultivate Real Confidence And Supercharge Your Career

Often we think of confidence as something that the lucky few are born with and the rest are left wishing for. But this couldn’t be further from the truth…

Think of someone who you say is confident – your boss, a colleague or a celebrity, perhaps. Chances are you’d describe them as poised, hopeful and positive. They know their strengths and they know their weaknesses, too.

Often we think of confidence as something that the lucky few are born with and the rest are left wishing for. This simply is not true. Confidence is not a personality trait or a fixed attribute; it’s the outcome of the thoughts we think and the actions we take. Confidence is learnable.

It also isn’t based on our actual ability to succeed at a task but on our belief in our ability to succeed. It is the expectation of a positive outcome – regardless of whether this relates to our belief in our ability to speak in front of a large audience, to learn new technology, to lead a team, to handle confrontation, to change jobs and careers, or to start a business.

With consistent effort, and the courage to take a risk, we can gradually expand our confidence and, with it, our capacity to build more of it. Here’s how to do that in four ways.

  1. Show up as the real you

Having the ability to show up with real confidence means you know yourself, you can be yourself and you show up as the best version of yourself. This is more than getting out of bed, splashing some water on your face and fronting up at your desk hoping you can cope with what the day throws at you.

You believe you can draw on what you are great at. You believe what you’re good at is important, and that it’s aligned with how you are working. You believe that you are valuable and valued.

Showing up as truly confident over a sustained period of time is something that needs to be built from the inside out. ‘Faking it until you make it’ only gets you so far and for so long. Trying to pretend you have the confidence needed to get the job done can be exhausting.

2. Stand up for yourself

At work, especially if you’re looking to get into a leadership position, you need to speak up when no-one else will. You need to be visible, make unpopular decisions and go slow in order to go fast. You must stand alone in a crowd and have the confidence to believe in yourself. You don’t need to be the Dalai Lama, but you do need to stand up for what you deem right, fair and important.

When it comes to building your confidence in standing strong, ask yourself:

  • What do you VALUE? To speak out, you have to know what to speak about. To stand up for your beliefs, you have to know what you stand for.
  • What is your PURPOSE? Steve Jobs once said, ‘Being the richest man in the cemetery doesn’t matter to me. Going to bed at night saying we’ve done something wonderful, that’s what matters to me.’ That’s a clear sense of purpose. He was clear about what he stood for and why, and you need to be too.
  • How RESILIENT are you? Inevitably, when we stand up, we are putting ourselves at risk of rejection. Building your capacity to get back up again is important in maintaining your confidence during adversity and setbacks.

3. Speak up and have a voice

A sure way to fail in today’s demanding business environment is to keep quiet when you should be speaking up!

People often tell me that they don’t speak up because they are not confident and they fear being judged. My response is, ‘So you would rather be judged on just sitting there and saying nothing instead of taking the opportunity to have a voice and potentially getting it wrong?’ The likelihood is that we are going to be judged one way or another.

Many of us also back away from speaking up to avoid conflict. We see conflict as bad, rather than being able to reframe it as healthy debate. As a result, we keep our opinions to ourselves – thinking that if we just keep doing our job and delivering the outcomes, we will get ahead.

Yet we must be willing to speak up, even when it is hard or unpopular or you feel like it will cause conflict. As Martin Luther King Jr put it, ‘Our lives begin to end the day we become silent about the things that matter’. So, use your voice!

  1. Step up your performance

You need to have the confidence and skills, and the ability to take on an element of risk, no matter what role or industry you work in. To step up confidently, you need to master your mindset, build your personal brand and have great sponsors.

Reflecting on your current behaviours and stepping up as required is critical. You often need to do things differently tomorrow from how you are today. You need to take yourself out of your comfort zone – and be confident enough to do this – and be aware of your context and what the environment requires of you because this is always changing.

If you’ve got your ‘head down and bum up’ all day long, knocking off your to-do list, how will you be able to assess what you need to do to influence and ensure the work makes real progress?

Continue to challenge yourself and ask, ‘If what got me here won’t get me there, what do I need to be doing now to step up?’

When you do this in line with all the other confidence skills, then you start to cultivate your confidence and supercharge your career.