All posts by Procurious HQ

Sourcing, But Not As We Know It!

How many procurement pros do you need to manage $1 billion of spend? We examine the stats revealing the state of today’s sourcing landscape…

How many staff does it take to make a success of strategic sourcing?

We might not have a definitive answer to that question, but we do have access to some figures that tell us a lot about the state of the sourcing landscape today.

For instance, we know that companies dedicate 16 full-time employees (FTEs) to the sourcing process for every $1 billion in spend. It’s one of those stats that makes you think. At first glance this might sound ok, right? 16 full-time staff can achieve a lot. But $1 billion represents an incredible amount of procurement.

The fact is, most organisations aren’t maximising the value of their purchasing. Efficiency is being compromised, and in this there are a number of factors at play.

Periodic category reviews, while being the best way to ensure effective sourcing, are just not possible for most organisations with the resources available to them. This means companies aren’t adjusting their sourcing to account for changing market conditions.

Compounding the problem, the bulk of sourcing teams’ time – 50 per cent – is swallowed up by the supplier evaluation and negotiation stages, which in some cases can involve highly complex financial and regulatory work. With so much time spent on this phase, more strategic and potentially value-adding phases such as planning – which are still mostly conducted by category managers – don’t get the attention they deserve.

Looking at the landscape as a whole it’s no surprise that most sourcing projects are long and costly, and ultimately don’t deliver the results that stakeholders expect.

Strategic sourcing, it’s a-changing

And automation is the key…

More and more firms are convinced that digital transformation is the answer to increased efficiency in strategic sourcing, and they’re not afraid to invest in software that gives them a procurement advantage. In fact, they spend more than a quarter of a million dollars a year on these solutions. What’s more, they’ve found that this investment is paying off. According to these companies, supplier discovery, e-sourcing and contract lifecycle management software is helping them streamline the entire sourcing process – from discovery to contract signing. As a result, their total sourcing times are being reduced by 30 per cent as are their costs.

This is just the beginning of a trend that holds significant opportunities for organisations. But firms need to be bold in their thinking to achieve these results. Increasing FTEs isn’t the route to increased efficiency. Companies need to look to technology to help them transform their procurement processes and deliver faster, more cost-effective sourcing than ever before.

To discover how your organisation can embrace digital transformation and reduce costs and cycle times by 30 per cent, read The Hackett Group report now.

The Jaggaer Juggernaught Rolls On

With the recent acquisition of BravoSolution, Jaggaer continues its trajectory of rapid, aggressive growth to contend for the title of the world’s largest spend management solutions company. 

The Jaggaer growth story has been interesting to watch. Formerly known as SciQuest, the company’s announcement about BravoSolution needs to be understood in a long line of acquisitions beginning in 2011:

  • January 2011: AECsoft (supplier management and sourcing technology)
  • August 2012: Upside Software (contract lifecycle management (CLM) solutions
  • October 2012: Spend Radar (spend analysis software)
  • September 2013: CombineNet (advanced sourcing software)
  • June 2017: POOL4TOOL (to add direct material capability and introduce Jaggaer Direct)
  • December 2017: Italmobiliare’s BravoSolution.

The company’s press release says the acquisition will effectively render Jaggaer the “largest independent, vertically focused spend management solutions company in the world”. The solution includes advanced spend analytics, complex sourcing, supplier management, contract lifecycle management, savings tracking, and intelligent workflow capabilities.

As a result, Jaggaer will have over 1,850 customers connected to a network of 3.7 million suppliers in 70 countries, served by offices located in North America, Latin America, throughout Europe, the United Kingdom, Australia, Asia, and the Middle East.

Spend Matters reports that this latest move will make Jaggaer “the No. 2 player to SAPAriba in the procurement technology market by revenue”.

A Spend Management “Super Suite”

Robert Bonavito, CEO of Jaggaer, says that the move “creates a powerhouse in the global spend management space and represents the execution of our strategy to build a Super Suite of fully integrated spend management solutions. This acquisition enables the largest companies in the world to do business with a single partner and cover all of their spend management needs. We have best of breed, fully developed solutions for multiple vertical industries delivering value across the full spectrum of spend types. With our size, financial stability, and expanded infrastructure we can further accelerate product innovation and bring customer value across a vast swath of geographies and industries.”

The CEO of BravoSolution, Jim Wetekamp, commented that Jaggaer is “a bold company on an aggressive growth path. The combined entity will deliver greater opportunities for both customers and employees. The combination will allow increased innovation and provide a foundation for procurement digitalisation that will set the trends and benchmarks for the entire industry”.

What’s next? 

The language used in the press announcement (“covering all spend management needs” and “full spectrum of spend types”) appears to suggest that with the acquisition of Bravo, Jaggaer’s offering is now complete. But is this the peak of Jaggaer’s rapid growth story? As the dust settles and any remaining gaps begin to emerge, users may get a glimpse of the type of solution Jaggaer intends to acquire next.

Meet the James Bond of Procurement

Looking for some holiday reading? We review Christopher Hepworth’s “The Last Oracle”, a fast-paced thriller starring Sam Jardine, the world’s greatest negotiator – and a procurement professional!

As a series of bizarre climate-related events occur across our planet, it seems the world is edging towards a catastrophic tipping point.

Rex Daingerfield is the owner of a giant fracking company that seeks to exploit a rich seam of gas in the environmentally sensitive Greenland ice shelf. But Daingerfield has a nemesis – his daughter. Born to an Egyptian mother, she is inducted as the Oracle of the Temple of Sekhmet. Her role is to protect the earth from the likes of her father.

The Oracle recruits the world’s greatest negotiator, Sam Jardine, to convince her father to change his destructive business model. But a secret society of the rich and powerful stands to profit from the chaos that has gripped the world. Led by an errant priest from the Temple of Sekhmet, they will do anything to stop Jardine.

As the planet edges closer to disaster, Jardine is confronted by politicians, lobbyists, vested interests – even his own radicalised half-brother – all of whom stand to gain from the mayhem about to be unleashed.

Sounds exciting, doesn’t it? Here’s what we enjoyed about this book.

A procurement hero

Sam Jardine is a procurement professional who is sent all over the world on special projects when his incredible powers of negotiation are required.

He is described in some of the advertising around The Last Oracle as “the new James Bond”. There are certainly some similarities – he keeps his cool in the novel’s many action scenes, he loves fast (solar-powered) cars, and he wins the heart of at least two female characters. But in many ways, his character has more depth than Bond. Jardine isn’t always sure of himself, and one of the strongest themes running through the book is his internal conflict between loyalty (and fear of) his oil-industry employer, his own conscience and his knowledge of impending climate catastrophe. He’s also very fallible – he makes mistakes, he gets severely injured on more than one occasion, and he doesn’t always “get the girl” despite his good looks and charm.

Jardine is also described as the world’s greatest negotiator – and this holds true, with arguably the best scenes in the novel being negotiations. Jardine leverages his cultural intelligence when negotiating with an African tribal chief, thinks fast to save his job in an interview with his furious CEO, negotiates for his life before a vengeful Egyptian goddess, locks horns with Washington lobbyists and politicians, and even extracts a multi-million dollar family secret from a drunken uncle in an English pub for the price of two pints of ale and a packet of crisps. The back-and-forth dialogue in these scenes is spot-on, and Jardine frequently wins the day by taking a risk that his opponents (and the reader) doesn’t expect.

The characters

Although there are some characters in the novel who have more scope for development, such as the ruthless fracking tycoon Rex Daingerfield, the bullish oilman Chuck Crawford, and even some radicalised Islamic terrorists, there are a handful of characters that are gratifyingly complex. We’ve already mentioned the hero Jardine’s internal struggles. Daingerfield’s mysterious daughter, Sienna, is one of three strong, intelligent female characters that Jardine interacts with, and faces a schizophrenic struggle between her identity as a holy oracle of an ancient Egyptian goddess, her filial duty to her father, and her mission to prevent an environmental holocaust. This conflict eventually lands her in psychiatric care. The theme of mental health is also present in Jardine’s younger brother Jack, whose internal demons and severe lack of judgement makes him an easy recruit for the aforementioned terrorists. 

The author is a CPO!

To let you in on a secret, “Christopher Hepworth” is actually a pseudonym. The author is head of procurement in their country for one of the world’s leading insurers, and therefore knows a thing or two about negotiation.

The world needs more procurement heroes, including fictional ones, to help raise the profile of the profession. Five stars!

The Last Oracle is the third Sam Jardine Thriller from author Christopher Hepworth. Read more reviews and purchase your copy on Amazon.

Could You Do A TED Talk On Your Category?

Great category management is like a killer TED Talk – it’s strategic, it’s well researched and it’s delivered with true passion.  Have you got what it takes?

Our webinar, Breaking the Groundhog Day Mentality: Enabling A True Category Management Mindset takes, takes place at 1pm GMT on 29th November 2017. Register your attendance for FREE here.   

There are over 2,500  TED talks available online, each dubbed with the organisation’s tagline “ideas worth spreading” or “talks to stir your curiosity”.

But, what makes these bitesize videos so universally appealing? What common traits do the talks share that piques the curiosity of the general public and guarantees thousands upon thousands of views?

We’ve delved in to the intricacies of a winning TED talk and, it turns out, some of the key qualities of a killer TED talk can also be applied to category management.

Christopher Eyerman, Senior Director, Denali – A WNS Company explains, “Category management is not just a process, it’s not just a set of tools. It takes on-going focus and the development of key skill-sets, just like any function or discipline within an organisation, in order to be the best that you can be.”

So, what are the things category managers need to do well as per the TED talk rulebook?

Keep It Snappy And Strategic

TED talks never, ever exceed 18 minutes of content, no matter what the subject matter, level of complexity, importance or fame of the person delivering the talk. By insisting speakers cut content from a talk they might normally deliver, TED guarantees audiences a level of discipline, focus and a clear thought process behind the key point delivered. The process encourages presenters to take a strategic approach.

Christophe Ysebaert, Partner, Transitive Management, explains, “Procurement organisations need to switch from being 20 per cent strategic to 80 per cent strategic. A key skill set for your team of category managers is to have a strategic mindset.”

Much like producing a TED talk on a complex subject, “To build strategy, you have to work from a huge amount of data,” Christophe continues. “You’re going to gather data from the market, your internal stakeholders, spend data etc. At some point, you need to analyse that data and come up with something that makes sense in terms of strategy.”

Tell Your Story

It goes without saying that communication and story-telling are key elements of any TED talk. Presenting key messages, an argument or a lecture in an accessible and insightful way to a diverse audience widens the appeal of topics that might have previously been alienating.

Christophe explains,  “When you do category management, you talk to internal customers, business people etc. and you have to be able to sell your case and your strategy.

“At my company, we’ve put together a package of information about how to tell a good story because that’s something you need to do all the time in this profession. ”

Category managers must be able to present their case to a wide range of stakeholders.

Find Your Passion

It’s rare to watch a TED talk and not get a sense of the speaker’s passion for their subject. They are the experts in their chosen topic, its greatest advocates and their extensive knowledge on the subject reflects this.

Chris explains why passion and curiosity are at the heart of category management, “Getting very deep with your category, getting deep with the data, deeply understanding the external market place, and having that sense of true curiosity [is important]. The best category managers never seem satisfied, they never think they know everything they need to know, they’re always pushing and trying to find additional information and additional ways to better understand their categories.”

Ask yourself, Chris says,  “Could you as a category manager give the TED talk on your category?”

Know Your Audience

When dealing with internal or external stakeholders in category management, you need to know what makes them tick or how to engage them, what you want to achieve from talking to them and what are you selling them!

“This doesn’t mean – ‘I know Joe we play basketball together!’ ” says Chris. “It’s about really understanding them. From their business, their needs, co-aligning with them in terms of their objectives and yours, developing a strategy, and sharing your vision with them.”

Just like in a TED talk, category managers need to leverage their sales skills.

Chris concludes “Selling your vision, building a strong business case and being able to influence stakeholders and align stakeholders to a strategy” are crucial to make it as a great category manager.

Want to hear more on this topic from Christopher Eyerman and Christophe Ysebaert? Tune in to today’s webinar, Breaking the Groundhog Day Mentality: Enabling A True Category Management Mindset at 1pm GMT. Register your attendance for FREE here. 

Debt as a Source of Risk in the Supply Chain

What debt conditions, putting pressure on our global economy , should procurement pros make themselves familiar with? And how can we mitigate supplier risk? 

This blog was written by William B. Danner

Two leading authorities on corporate financial health, Dr. Edward Altman, Professor of Finance, Emeritus, at New York University’s Stern School of Business and creator of the Altman Score, and CreditRiskMonitor Founder and CEO Jerry Flum, recently presented a webinar to hundreds of supply chain and credit professionals about today’s mammoth corporate debt problem.

As the primary point of contact between their company and suppliers – not to mention a first line of defense against third party risk – procurement and supply chain professionals should be concerned with the degree to which public companies are leveraged today.

Dr. Altman and Jerry Flum identified three unprecedented debt-related conditions, putting pressure on the global economy today that procurement should be aware of from a risk mitigation perspective:

1. Compare debt to GDP

One of the best ways to put debt levels into perspective is to compare debt to GDP. In the U.S., total debt is currently at a historically huge 3.5 times GDP. Of this total, corporate debt is large and growing. Overall debt levels are so large we must be concerned about the investors who own this debt, not just the borrowers. A 10% decline in value would destroy wealth equivalent to 35% of GDP, with a major effect on spending. Junk debt (high-yield bonds and leveraged loans) has soared to $2.5 – 3.0 trillion world-wide.

2. Benign credit cycle

Now in the 8th year of what is usually a 4-7 “benign credit cycle”, many executive teams have let their guard down, forgetting the lessons of the past. As Dr. Altman explained in the webinar, a ‘benign credit cycle’ has four characteristics:

  • Low default rates
  • High recovery rates when bonds default
  • Low interest rates, yields, and spreads
  • High liquidity

In other words, credit is cheap and easily available to publicly traded companies, which leads many companies to take on more debt. A great deal of debt has been issued to pay dividends and buy back stock, making corporations riskier.

3. Corporate valuations

Corporate valuations are inflated, with market values far higher than historical norms. Private equity firms are paying as much as 10 to 11 times cash flow for acquisitions. High stock prices make corporations less risky, but stock prices can fall.

Whether companies give in to the mania or make a disciplined choice to break free from the pack, procurement and supply chain professionals can take action to mitigate supplier risk and prepare their companies to handle the downturn when the next recession inevitably comes.

Suggested Steps for Supply Chain Professionals to Mitigate Supplier Risk :

1. Build in a monitoring process

Don’t stop with an initial vendor screening. Companies’ financial health can change and even a periodic review simply isn’t good enough. Avoid surprises and react quickly to change.

2. Get to know the vendors you do business with well

Ask questions such as:

  • “Who is the corporation we are paying? Is it under a different name?”
  • “Are they actually manufacturing the product or is someone else?”
  • “Where are their operations?”

Be cautious, especially if you are not getting clear answers.

3. Don’t over-do it

Not all your vendors will present a problem if they enter financial risk. Ask yourself:

  • “Is the commodity/product easy to replace? Is this a one-time contract?”
  • “Or, could this vendor create a major issue with our ability to ship on time, the quality of our product, or with our customer satisfaction?”

Only if you find that it’s a “yes” to the second question do you need extensive review.

4. Incorporate financial analysis in your key vendor review process

Be sure to include multiple periods of financial statements in your review to see trends. If you are finding it difficult to get financial information, be wary. 

5. Compare your vendors with the financial condition of their peers

You may find more secure sources of supply.

6. When appropriate, take a hard look at the financial stability of your vendor’s suppliers

They are part of your supply chain and could be a significant exposure.

7. Have an open and honest communications process

You’ll want to explore with your vendor the performance factors that directly impact you such as shipping reliability, product quality, etc. but also financial stability. Knowledge is power and knowing all the facts gives you the time to identify and prepare alternative source(s) of supply.

8. Look at more radical options if a vendor looks too weak

  • Make vs. buy decision
  • Engineer a stronger vendor into the supply chain
  • Buy the troubled vendor, or
  • Help arrange for a preferred vendor to purchase the troubled vendor.

The fact of the matter is that today’s debt situation is historically unprecedented. We can’t be certain of the timing of a change in the financial markets, or what will serve as the trigger, but a shift is coming – so now is the time to prepare and put your processes and procedures in place.

The full webinar can be viewed here.


William B. Danner has been president of CreditRiskMonitor since May 2007. Bill has more than 35 years of financial and information services experience. 

Prior to CreditRiskMonitor he worked in brand strategy and business development consulting for financial services clients at his own firm, Danner Marketing. Previously he was at Citigate Albert Frank, a marketing communications company in New York City, where he worked on a variety of leading financial services accounts including Reuters Instinet and the CFA Institute. From 1997 to 2001, Bill was Vice President of Market Development at MetLife’s employee-benefits business. Before joining MetLife, he was at Dun & Bradstreet, most recently as VP Strategic Planning. He spent the first decade of his career at GE Information Services and GE Capital.

Bill earned a BA in economics from Harvard College and an MBA from Harvard Business School.

TGINF- Thank God Its Not (Black) Friday

We should probably  all be grateful that Black Friday is over and done with for another year. But what have we learnt from the biggest shopping day of 2017? 

There’s nothing quite like the cold panic of a missed opportunity. Particularly if said opportunity comes in the form of a heavily discounted HD television, bargain flights to Majorca in  mid-January (who wouldn’t?!) or a half price sofa-bed (ideal if you can carry it out of the store mid-customer stampede).

Media hype surrounding “Black Friday”, which slowly seems to be evolving into “Black Week” and surely soon to be “Black Month”, increases year on year.  Retailers face intense and  increasing pressure to slash prices and offer the biggest and best best deals to entice Christmas shoppers and out-perform their competitors. As such, the fuss and excitement leading up to the biggest shopping day of the calendar year is palpable. The world’s consumers anticipate great things.

But does the propaganda live up to the reality? And what are the downsides of events like this for our supply chains, our procurement organisations and SMEs?

Black Friday 2017: The stats examined

Spend: It’s hard to argue against the importance of Black Friday to the economy. According to the National Retail Federation’s 2015 report,  up to 30 percent of a retailer’s annual sales occur between Black Friday and Christmas. Last year 101.7 million Americans braved the crowds, an increase of 37 per cent from the previous year and spent $655.8 billion over the four day weekend. This year, that figure is expected to have increased to a whopping $682.0 billion, and that’s just the U.S.!

Savings: The debate rages on over the true value, to the consumer, of Black Friday. Are you really nabbing a bargain? Aside from the obvious fact that many consumers wind up purchasing un-needed items, statistics show that many items, as much as six out of ten, are actually cheaper at other times throughout the year.

An Underwhelming start to UK’s Black Friday: Some members of the British public were seemingly raging on Twitter on Friday morning over the perceived anticlimax of Black Friday.

Others meanwhile, poked fun at the distinct lack of chaos in stores across the UK, noting the ever-present, ever-respected British culture of courteous queuing!

 

Debt: According to a 2016 survey by TD Bank, 25 per cent of Americans will take three months to pay of the debt racked up on  Black Friday and the remainder of the holiday season

South Africa: South Africa has been hailed this year as the nation most devoted to Black Friday.  Last year “South Africans made 226 per cent more purchases [than at any other time of year] on [Picodi]‚ more than twice as large a percentage increase as that of any other country.” And the frenzy doesn’t seem to have lessened this year with media reporting the mayhem inside shopping centres.

The demand of black Friday on our supply chains

As the BBC pointed out, whether they like it or loathe it, “most retailers on – and offline – will find it difficult not to join in” with Black Friday. If they don’t partake they’ll lose significant custom, which places enormous pressure on smaller, or struggling, organisations with tighter margins and less turnover.

However YouGov research commissioned by Amazon found that nearly 1 in 4 UK SME retailers intended to participate in Black Friday 2017 and 82 per cent of those participating are expecting to sell more stock on Black Friday than on an average day. The key to success for these SMEs is getting the pricing and forecasting right.

The anticipated frenzy also makes it difficult for organisations to accurately forecast volume of stock. According to data collected by Love the Sales, there was an unprecedented 43 per cent increase in the volume of items on sale in October this year compared to last year. Buy too little from suppliers, and  they’ll run out of stock, buy too much and face having to do further discounting in the new year to shift products.

In these circumstances, buyers must ensure their supply chains are strong enough to cope with the increased demand for products and, most importantly, that their suppliers meet their compliance requirements.

According to courier insurer Staveley Head, more than 82,000 lorries will be on the road to deliver on Black Friday, with Royal Mail bringing in an additional 6,800 vans just for the peak period.

Edie.net urged organisations to run traceability checks to identify any exploitative labour practices within their supply chain and recommended  using the Internet of Things to track supply chain processes and spot any unusual patterns of behaviour.

In other procurement news this week…

Apple’s Illegal Labour

  • Apple’s main supplier in Asia has been employing students illegally working overtime to assemble the iPhone X, as it struggles to catch up with demand after production delays
  • 3,000 students from Zhengzhou Urban Rail Transit School were sent in September to work at the local facility run by Taiwan-based Apple supplier Hon Hai Precision Industry, better known as Foxconn
  • They were told that a three-month stint at the factory was required “work experience” that they had to complete in order to graduate

Read more at Financial Times

50 per cent of procurement pros are unhappy with salaries

  • The latest procurement salary guide by recruiters Hays found 56 per cent of procurement employees reported a high level of salary dissatisfaction, and almost a quarter of those surveyed stated they intended to leave their current job because it lacks future opportunities
  • The average procurement and supply chain professional’s salary has increased 2.1 per cent over the past year, above the overall UK average of 1.8 per cent, Hays found. This rises to 3.6 per cent for procurement managers and senior buyers and to 4 per cent in the public sector
  • Hays salary guide is based on job listings, offers and candidate registration, as well as a survey of almost 17,500 employers and employees, including more than 700 working in procurement

Read more at Supply Management

Why Don’t You Trust Your Procurement Boss?

Ever feel like you’re being stabbed in the back by your procurement boss? You’re definitely not alone and we have the stats to prove it!

Ta Animator/Shutterstock.com

When Procurious put out a call for procurement survey participants, we were delighted when 500+ professionals across more than 50 countries shared their insights and wisdom.

Amongst our most startling discoveries was that over half of those surveyed don’t trust their boss to be proactive about their career progression. This result indicates that professionals need to seize control of their own career advancement, while managers need to be incentivised to support and progress their direct reports.

The Results Explained By Global CPOs

At The Big Ideas Summits in Chicago and Melbourne earlier this year we revealed the results of the survey to our CPO delegates.

We were particularly interested in their thoughts on what procurement managers should be doing in order to regain the trust of their team members. The video below shows a compilation of their responses:

What’s the root cause of these  trust issues?

Why is trust so terribly lacking between procurement professionals and their leaders?  A number of  key factors arose from our research:

Rate of Change – David Henchliffe, Group Manager Procurement OZ Minerals attributes the lack of trust to the astounding rate of change in today’s organisations, “What people seen as firm and certain today, is gone tomorrow. That constant change erodes trust. And it erodes peoples’ view of your genuine-ness.”

My boss doesn’t want me to leave – Many of us can relate to the experience of having an overly protective boss, a boss who is keener to hold on to their talent at all costs rather than priortise career development. Alan Paul, CEO Sourceit, takes his responsibility in this area very seriously, “As a manager I need to demonstrate to my staff that I’m not afraid of them leaving the organisation. I want to develop them I want them to improve themselves.” If employees feel like they are missing out on opportunities because of an unsupportive boss, it’s likely they’ll leave anyway!

My boss doesn’t engage or communicate with me – The value in talking and listening can never be underestimated.  Imelda Walsh, Recruitment Consultant, The Source believes that “fantastic leaders encourage honest and open conversation. If procurement managers can take that step, you’ll naturally build trust”

My boss isn’t helping my career development – If it appears that your boss doesn’t care about helping you to advance your career, of course you’re not going to trust them! Michelle Varble, Procurement Director, United Airlines, asserts that  “we need to take a geuine interest in [our employees] success- we need to take on the roll of mentor even if we havent recieved a specific invitation to be a mentor.”

My boss isn’t ethical – Employees will hold a leader in high regard who both demonstrates good ethics  and demonstrates that they genuinely care about good ethics. People want to work for companies that are not soley motivated by savings and profit, that aren’t covering up immoral behaviour and where they aren’t suspicious of the goings on at the top of the company.

A lack of ethical behaviour at the top sets a terrible example to the rest of the organisation and destroys trust.

What can procurement leaders do to regain trust?

Encourage development – Anna O’Dea, Director and Founder of Agency Iceberg, believes that “a  good employer should encourage the development of their employees. If your employer isn’t investing in your training or opportunities, you could be in a one-way relationship.”

Spend time with your talent – David Henchliffe advises leaders to regain trust by devoting more quality time with employees, “spend time with them, get to know them, admit your mistakes and praise them when they do well.”

Put clear career progression procedures in place – Implementing clear structures within an organisation reassures employees that their progress is being monitored and the value they contribute is recognised.  John Foody General Manager Procurement, U.S Steel explain how his organisation “We’ve put in place some tools that we call Career Ladders, that evaluates and gives feedback to our people. It provides them with feedback on their skills, their capabilities, areas to continue to work on. It gives them a sense of progress as they continue to move through our organisation.”

Take the fear away – Don’t let your employees worry about your lack of commitment to them. Reassure them that you  have their best interests at heart, and not your own!  Alan Paul asserts that “for a manager, a true leader, it’s about taking away the fear that your people are going to leave and trust that they’re going to stay. But also accept the fact that eventually they are going to move on.

How can you advance your career without the help of your untrustworthy boss?

As Procurious founder Tania Seary asserts, “It’s all too easy to find excuses for why your career is not panning out the way you intended. Soft targets for blame include your employer, your peers, your organisation or even your own personal life- challenges for blocking your charge to the top.

“We know there are some significant problems with procurement bosses around the world but…as I have always said, and will continue to say, the only common denominator in your career is YOU.”

So join that professional network, start updating your online CV, enroll on an eLearning course, listen to that podcast series you keep forgetting about  and start connecting with influential peers and thought leaders! The procurement world is your oyster…

Request your copy of the Gen NEXT Report

The Gen NEXT report, exclusively available to Procurious members, is packed with data, insights, recommendations, and links to over 20+ Procurious articles that further explore many of the findings that are raised in the report. Email us to request your copy. 

Would You Order A Tesla Electric Semi?

Elon Musk promised that the Tesla Semi reveal would “blow your mind clear out of your skull and into an alternate dimension”. The truck is certainly a game-changer for the logistics industry, but Tesla faces some steep challenges if it plans to win over the commercial market.

We can’t wait to see these trucks on the road. The sleek, bullet-train shaped cab of the Tesla Semis will be instantly recognisable once they hit the freeways in 2020 – if Tesla can overcome the production delays which are increasingly plaguing the organisation.

What can the Tesla Semi actually do?

Equipped with a battery instead of a diesel tank, the Tesla Semi is capable of travelling 804km (500 miles) on a single electric charge – even with a full 36,000kg load. Its autopilot system will go a long way towards eliminating human error in truck accidents, with the ability to automatically:

  • detect instability and adjust each wheel individually to make jack-knifing “impossible”
  • maintain a set speed and slow down in traffic
  • keep the vehicle in its lane with lane detection and lane departure warnings, and
  • lock onto other Tesla Semis to travel in a convoy.

Charging will take place via a planned, worldwide network of solar-powered “Megachargers”, which will be added to Tesla’s existing network of 2000 Supercharger stations which are in place to power Model S sedans. For drivers in a hurry, a 30-minute charge will enable 640km (nearly 400 miles).

Inside the cab, the driver’s seat is positioned in the centre of the space (which has full standing room), allowing better visibility. The seat is flanked on both sides by touch screens that provide blind spot monitoring and navigation. The truck also comes with tracking features to be used by a fleet manager for routing, monitoring and scheduling.

What’s the cost?

Unknown – Musk didn’t reveal the unit price on stage, but claimed the Tesla Semi would cost 20% less per mile than a diesel-powered truck. Whatever the price is, it’s only likely to fall in the future as regulations on diesel continue to tighten, charging infrastructure improves and the costs of batteries fall.

Despite the unknown price, pre-orders have started flowing in from companies including Wal-Mart (15 trucks), Meijer (4 trucks), and J.B. Hunt (“multiple trucks”).

Will we see these trucks on the road in 2020?

“If you order now, you get your truck in two years”, Musk said at the reveal. The company, however, has been known to over-promise and under-deliver when it comes to production deadlines. The Model 3 sedan, for example, has been beset by 18-month delays. While the company’s consumer fans are apparently willing to tolerate delays, commercial trucking companies are likely to be less patient. The Tesla Semi notably represents the company’s first foray into the commercial vehicle market.


In other news this week:

NAFTA Negotiations Struggle Onward

  • Reports from the NAFTA negotiations reveal that little progress has been made on U.S. demands that could potentially sink the 1994 trade pact between the U.S., Mexico and Canada.
  • Officials are currently meeting in Mexico City for the fifth of seven planned rounds of talks. Upcoming presidential elections in Mexico mean that a deal needs to be reached by late March 2018.
  • New U.S. demands include a five-year sunset clause, and tightening of rules of origin to boost the North American content of autos. Other issues discussed include labour, gender, intellectual property, energy, and telecommunications.
  • While Mexican officials have said “the work is moving forward”, Canadian negotiators complained on Friday about inflexibility by the United States.

Read more: CBC News   

Calvin Klein Bypasses Retailers For Holiday Shopping

  • Calvin Klein is offering an exclusive line on Amazon only for Black Friday sales, in a move that reflects the increasing shift away from traditional stores.
  • The company has announced a holiday retail experience called “Calvin Klein X Amazon Fashion”, with underwear and denim available exclusively in an online Amazon brand store and in Amazon pop-up shops in New York and Los Angeles through to December 31st.
  • Amazon’s pop-up stores pose another threat to brick-and-mortar retailers, in additional to the sales shift to online retail.

Read more: Wall Street Journal

New Procurement Benchmarking Report Released

  • APEX Analytix has released its “Procurement Leaders’ Benchmarking Report”, with best-in-class performance data from global organisations with a combined revenue of $2.3 trillion. The report reveals:
  • Only 10% of organisations have a combined P2P organization under common leadership
  • 65% of businesses don’t authenticate vendors against public domain data sources prior to payment
  • Only 14% capture verifiable details of a vendor’s CEO, CFO or principals.

Get the report here.

IT Procurement Without a Tech Strategy Is A Recipe For Disaster

If you’re struggling to effectively run your IT procurement processes, it might be time to evaluate your strategy!

This article was written by Harry Wilson, an IT Consultant. Read more via Leap Consulting.

If procurement is the series of activities and processes required during the acquisition of any IT infrastructure, software and systems, IT procurement and the purchasing of updated systems are essential to any business which uses information systems and digital technology equipment to drive projects, management and processes.

The running of the IT procurement process should be carefully managed and examined to ensure that  purchases provide both a good foundation and high-quality equipment for the future process, in line with the businesses goals.

This requires a dedicated employee in charge (usually the CIO) and an IT strategy to allow a business organisation to reach best practices of IT procurement.

Digital transformation and disruption

Digital transformation and disruption have changed the IT buying process. Traditionally, the CIO had the final say in IT purchasing decisions following consideration of the IT strategy and alignment with business goals.

However, recently it has been found that nearly a third of purchasing power has moved outside of the executive suite into the hands of departmental managers.

Business departments making technology decisions without the CIO can lead to CIOs losing control of the IT then having to deal with issues such as;

  • Lots of different systems running in silos
  • Information sprawl
  • Incompatible systems
  • Gaps in internal information technologies
  • Hindered business growth
  • Loss of competitive advantage

This emphasises the need for an IT strategy as one of the biggest mistakes a business can make is committing to a system or contract without due diligence or consulting the overarching IT strategy to understand how the implementation of the considered technology will impact the operations and systems within the business.

What should an IT strategy include?

An IT strategy can benefit both CIOs and department managers as it encourages collaboration that results in alignment with existing and new investments. A strategy should include up-to-date versions of:

  • A systems architecture rundown of the whole business
  • An inventory containing end-of-life dates, and usage
  • A list of emerging problems recorded by staff and IT team

The rapid speed that these technologies are being innovated is phenomenal, and businesses are being exposed to more technologically advanced IT systems which creates the need to update and adapt to these IT systems regularly.

The benefits of an IT strategy

Despite significant investments in new technologies over the past decade, many organisations are actually watching their operations slow down due to underutilisation of technology and poor user engagement related to technology usage is part of the problem.

Poorly designed applications and a general lack of training causes many employees not to leverage the innovation and drive productivity.

Encouraging effective adoption of new technology requires an IT strategy for organisational change management.

There’s no easier way to manage IT than to work with an IT specialist who can help you manage these IT services and create a more efficiently run business. Many companies are seeking It managed services for a source of competitive advantage, so there isn’t a lack of responsibility or confusion within the company.

By following an IT strategy and understanding the reasons behind process bottlenecks and other errors, enterprises can more efficiently allocate IT and human resources. By partnering with a managed services provider who can create and implement an IT strategy, businesses can focus on their core competencies to cut costs and increase productivity.

This article was written by Harry Wilson, an IT Consultant. Read more via Leap Consulting.

Breaking the Groundhog Day Mentality: Enabling A True Category Management Mindset

Does your category management journey ever remind you of the movie Groundhog Day?  Our latest webinar will advise you on how to break that repetitive cycle!Our webinar, Breaking the Groundhog Day Mentality: Enabling A True Category Management Mindset takes, takes place at 1pm GMT on 29th November 2017. Register your attendence for FREE here. 

The life of a procurement professional can easily descend into a vicious cycle. You’re asked to do more and more, in order to drive bottom line results for the business, but you’re without the time to approach these challenges innovatively.

It’s often something straight out of the movie “Groundhog Day,” where procurement is given bigger and bigger targets, and has to scramble to execute on more projects, touch more spend, react to more stakeholders and more issues, and then simply do it all over again….and again!

The problem is, if our category managers can’t find a way to break the reactive cycle and start taking different approaches, they can’t add value and deliver the best results.

Successful organisations have embraced the request to do more, and have turned it into an opportunity for the function; to increase the strategic role of procurement and make it a destination role within the business.

How do successful organisations navigate this journey? What are the keys to success? And what is imperative for individuals and organisations to do when on this journey to ensure they become closer than ever before to the business?

What content can I expect from the webinar?

We’ll be discussing:

  • What does it mean to have a category management mindset?
  • What key competencies or skills should category managers be developing?
  • How will category management needs continue to evolve over time?
  • How can procurement leaders change the game for category management?
  • What mistakes are category managers repeatedly making?

Who are the guest speakers?

Tania Seary – Founder, Procurious

A true procurement entrepreneur, Tania is the Founding Chairman of Procurious, The Faculty and The Source. Throughout her career, Tania has been wholly committed to raising the profile of the procurement profession and connecting its leaders.

After finishing her MBA at Pennsylvania State University, Tania became one of Alcoa’s first global commodity managers.

In 2016, Tania was recognised by IBM as a #NewWaytoEngage Futurist and named “Influencer of the Year” by Supply Chain Dive. She hosts regular procurement webinars, and presents at high-profile events around the world.

Christophe Ysebaert – Partner, Transitive Management

Christophe Ysebaert is a Partner with Transitive Management with expertise in purchasing strategies, strategic sourcing and project management. He is also a Part Time Teacher at Skema Business School in Lille (France) teaching category management and strategic sourcing.

Prior to joining Transitive Management, Christophe worked during close to 30 years for Dow Corning as a global manager in Supply Chain and Purchasing jobs. He served roles in Global Planning and more recently in Purchasing as part of the Procurement Leadership Team responsible for strategic sourcing and for a global augmentation program with a third party provider. He has also managed a global portfolio of commodities as well as led the European Direct Procurement Group.

Christophe holds a Master of Science in Business Engineering from Mons University and a Post-Baccalaureate Certificate in Logistics and Supply Chain Management from Penn State University.

Alpar Kamber,  Executive Vice President, Denali – A WNS Company 

Alpar Kamber is Executive Vice President at WNS and the BU Leader for Procurement Services. He was the Founder and CEO of Denali Sourcing Services, a next-generation procurement services provider that enables procurement organizations to influence more spend and execute more effectively and efficiently.

In January 2017, WNS, a global business process management leader, acquired Denali Sourcing Services. Prior to joining Denali, Alpar held management positions at Ariba, FreeMarkets, Diamond Technology Partners and E&Y. Alpar leads WNS clients in building scalable sourcing programs and operationalizing their procurement function that drive consistency, repeatable outcomes, and bottom-line value across the organization.

Alpar’s expertise is in procurement value chain, organizational design, change management and global program execution. Alpar holds an MBA degree from Tepper Business School of Carnegie Mellon University. Alpar Kamber was named a 2011 Pros to Know by Supply & Demand Chain Executive. Read more about Alpar Kamber in the HfS Research interview, Meet the sultan of strategic sourcing.

Christopher Eyerman, Senior Director,  Denali – A WNS Company 

Chris Eyerman is the Senior Director for WNS-Denali. Chris leads WNS-Denali’s Solutions and Capabilities group to design, deliver and continuously improve procurement programs that provide real, lasting value and creates permanent change in how our customers conduct procurement business.

He is a senior supply chain and program management executive with more than 30 years of technical and business experience, including 18 years of leading category management, source-to-contract, procure-to-pay and supply chain transformation programs. Prior to joining WNS-Denali, he served roles in program management, business development, product management and operations at FreeMarkets, Ariba and Exostar.

Chris holds a BS degree in Mechanical Engineering from Penn State, an MS degree in Aeronautics and Astronautics from MIT, and an MBA degree from Carnegie Mellon University.

How do I register for the webinar?

Registering for our webinar 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 confirmation email with a link to the webinar platform and a handy reminder one hour before we go live!

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 register to access the webinar via this platform. We’ll send you a confirmation email with a link to the webinar platform and a handy reminder one hour before we go live!

When is it taking place?

The webinar will take place at 1pm GMT on 29th November 2017.

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’re listening live, our speakers would love to hear your questions and we’d love for you to pick their brains . Questions can be submitted throughout the live stream via the webinar platform, or via @Procurious_ on Twitter.

If you think of a brilliant question after the event, feel free to submit your question via the Discussion Board on Procurious and we’ll do our very best to ensure it gets answered for you.

Our webinar, Breaking the Groundhog Day Mentality: Enabling A True Category Management Mindset, takes place at 1pm GMT on 29th November 2017. Register your attendence for FREE here.