All posts by Procurious HQ

Want to start your own ‘Group’ on Procurious?

So you’re a fully-registered Procurious member: you’re sharing stories with your peers, contributing to interesting discussion topics, brushing-up on your learning using our learning resources, yet you’re still craving more… Let us introduce you to our new Procurious Groups – the perfect haven to hang out with likeminded professionals around a core theme.

Groups on Procurious

Sergio Giordano – one of our original, early Procurious members has forged ahead and set up The Italian Procurement Professional Community. It currently boasts 44 members, making it the largest active Group on Procurious.

We asked Sergio if he’d like to share some words about the Group, and the approaches he’s adopted to entice new members:

“Italian professionals are beginning to understand that to achieve reputation you must first demonstrate your competence by helping colleagues and proving to be an expert in a specific field.

This is an essential feature which is the basis of my request to join the group. I also tried to make it clear to them that the opportunity to grow the Italian community in Procurious is huge. On one hand it helps to get in touch with a world of international procurement with the support of other Italian colleagues with whom to share their knowledge. And on the other hand, a means to enrich themselves with the expertise of colleagues from other countries. 

Finally, as you know, Italians like sport (and competition) so I spurred the decision to join the group by issuing a challenge: to be the most numerous and competent team in Procurious, by putting together the excellence of Italian procurement professionals. However I think that the first interest in joining  the group is the uniqueness of Procurious: we all felt a great need of a specialistic network like yours or, let me say… like ours.”

Create your own Group

To take a leaf out of Sergio’s book, navigate to the ‘Groups’ page by following the link (it’s nestled between the Discussions and Blog items).

To set up a group of your own, begin by clicking the ‘Create Group’ button.

Now you need a good name… The Group name should be succinct, and easily identifiable. You can go into extra detail in the ‘Description’ field – this should spell out your modus operandi.

You’ll also need to specify relevant industry and category choices using the drop-down menus (just like you did when you originally joined Procurious).

Finally, upload a small image that can be used as the Group’s profile picture. Now you’re ready to start inviting other Procurious members to your new Group – you can do this by typing names into the ‘Add members’ field.

Set privacy and permissions for your Group

Ideally you’ll want to retain full control of your little corner of Procurious – this is where the privacy and permissions controls come into play.

Set the Group privacy to ‘Posts visible only to group members’.

To manage the flow of new members to your Group we’d recommend selecting the ‘Any Procurious member can ask to join’ option in the first instance. This means that every time someone makes a request to come onboard you’ll receive a notification to approve/deny their membership.

We’ll be exploring Groups in more detail in future postings, but in the meantime we encourage you to have a play around and explore the new functionality on offer.

Have any feedback/comments? Leave below for Procurious to see!

Does procurement have a role to play in cyber security?

In the past few months alone there has been a significant number of cyber attacks on high profile targets including Sony Pictures, celebrities’ phones and personal computers, and, just recently, an attack on the US Military Command’s Twitter account.

Procurement's role in cyber security. Image Flickr

Now, as the World Economic Forum labels emerging technologies as one of the major global risks for 2015 in light of these attacks, we consider what procurement can do to aid organisational efforts in cyber security.

How big a worry is this?

If the WEF is highlighting it as a major global risk, then it’s certainly something to be taking seriously. Emerging technologies will allow hackers and cyber terrorists to carry out attacks that are more sophisticated and harder to stop. Additionally, there is a reported increasing skills shortage in cyber security personnel, expected to peak in 2017.

However, it’s not all bad news. The high-profile attacks have helped increase the focus on this subject. As a result, the UK Government has issued advice and information to organisations to help them be cyber-safe, as well as signing up to a second US-UK Cyber Security Innovation Summit. There are also now cyber governance health checks and a Cyber Essentials Scheme available to help organisations.

Procurement’s Role

A representative from the organisation that compiled the WEF report, Marsh & McLennan Companies, was quoted as saying “As a company you are not protected [against cyber attacks] unless your supply chain is protected.”

So what can Procurement do to help? Individually, you can do everything you would do to protect your personal accounts and computers:

  • Report all phishing and suspicious e-mails
  • Don’t click on links in e-mails unless you are sure of the source
  • Be wary of unsolicited e-mails asking for information

There are other steps that you can take as part of an organisation to assist with the overall security

  • Ensure your knowledge is up to date by attending conferences
  • Work with suppliers to put security plans in place
  • Make security plans part of your evaluations
  • Take responsibility in your team for checking and ensuring compliance
  • Investigate the Cyber Essentials Scheme

By making this part of day-to-day activities, procurement can do its bit to make organisations more secure.

Biggest Global Challenges in 2015https://www.procurious.com/blog/trending/what-are-the-biggest-global-challenges-in-2015

Cyber Security Boosthttps://www.business-cloud.com/articles/news/cyber-security-boost-uk-firms

Cyber Essentials Scheme (UK)https://www.gov.uk/government/publications/procurement-policy-note-0914-cyber-essentials-scheme-certification

Read on for more of the biggest stories commanding headlines right now:

Supply Chain woes help doom Target in Canada

  • Minneapolis-based Target Corp. said Thursday it was shuttering its 133 stores in Canada, laying off 17,000 workers and placing its Canadian operation under bankruptcy protection.
  • “While this is a difficult decision, we believe it is the right one for Target,” Brian Cornell, Target chairman and chief executive officer said in a press release. “We had great expectations for Canada but our early missteps proved too difficult to overcome.”
  • New York Times article Friday said that supply chain problems helped doom Target’s operations in Canada. “Differences in suppliers and other factors meant that Canadians found Target’s Canadian stores to be more expensive than they anticipated, and a poorly executed distribution network meant that shelves were often missing basic products,” according to the Times.

Read more on CFO

Troubled McDonald’s Japan to put CFO in charge of supply chain 

  • McDonald’s Japan Holdings Co is putting its chief financial officer in charge of its supply chain, according to an internal email seen by Reuters.
  • The move comes after foreign objects were found in customers’ food, the latest trouble for a fast-food chain hit by sliding sales and a shortage of french fries.
  • Andrew Brough, senior vice president and chief financial officer, will take over the company’s Supply Management Division from Feb. 1, the Friday email from CEO Sarah Casanova said. The email does not say who was previously responsible for the supply chain.
  • Hidehito Hishinuma, senior vice president and chief support officer, has in recent days appeared at news conferences to discuss the company’s procurement, in one case apologizing for the objects, including a tooth and plastic, getting into food.

Read more at Business Insider

Yusen Logistics expands Sydney operations

  • Yusen Logistics Australia has announced that it will open its sixth Sydney warehousing facility this month. The site is at Greystanes in Western Sydney and is ideally located for all major arterial routes.
  • The new warehouse, which is dedicated to a major US retailer, consists of 12,500 square metres and will comprise 18,500 pallet locations. Operations will commence immediately.
  • Yusen Logistics’ Managing Director for Australia, Ian Pemberton said: “This additional facility continues the expansion of our portfolio in line with our three year growth strategy, and demonstrates our commitment to increase the range of international clients to whom we provide supply chain solutions. The capital investment is in excess of $2 million Australian dollars and the facility will employ an additional 25 Yusen staff.”
  • Yusen Logistics Australia is a leading provider of supply chain and transport solutions with over 26 years of service in Australia and revenues of over $125 million Australian dollars in 2014. The business has 12 offices throughout Australia with 420 people covering international freight forwarding, in-house customs clearance and contract logistics (warehousing and distribution) services.

Read more at Supply Chain Digital

Jailed Military procurement official blackmailed

  • Former Greek secretary general for military procurement Yiannis Sbokos is being blackmailed by a fellow convict, revealed a Greek police case file. Sbokos has been in prison for the last two years, since his conviction for money laundering.
  • According to the case file, Sbokos is being blackmailed by a convict (Yiannis Sk.) who found out that the former Greek government official had 10 million euros in cash. Yiannis Sk. allegedly received this information from Akis Tsochatzopoulos, fellow convict and former Greek Defense Minister.
  • Yiannis Sk. allegedly threatened Sbokos, requesting part of the money. However, when the former official refused, his fellow convict attempted to bomb his house in Athens.
  • Sbokos and Tsochatzopoulos were imprisoned after it was revealed that they had received multiple bribes for arms deals during their time at the Ministry. Furthermore, it was revealed yesterday that Tsochatzopoulos had ordered a bombing attack against Sbokos.

Read more at Greek Reporter

Thailand drafts public procurement law following UNDP review

  • The Thai government is drawing up legislation to manage the risk of corruption in public procurement, following the UN Development Programme’s ‘integrity risk assessment’ of the country’s public purchasing system.
  • The assessment found evidence of “weak integrity in public contracts” and a concentration of improvements in public services in Bangkok and the central region, leaving “significant deficiencies” in other parts of the country.
  • Risks to integrity in Thailand’s non-regulated public procurement process are “rife” because of the large amounts of money at stake and the interface between the government and private sector, which is characterised by a high volume of transactions.
  • The assessment was conducted as part of the ‘Mitigating Risks to Integrity in Public Procurement project’, established by UNDP Thailand with key stakeholders in the Thai Government, including the Offices of Public Sector Development Commission and Public Procurement Management Department and the State Enterprise Policy Office.

Read more on Supply Management

What’s got you motivated in 2015?

Thanks to everyone who has been contributing to the Discussion forum, both in asking and answering questions. We really appreciate the contributions, as do those people who are posing the questions.

What's got you motivated in 2015?

As it’s a new year, we’ve picked out a few popular questions on topics you might be considering as part of your professional and personal goals this year.

As ever, we’ll be linking these discussions to our great blog content so you can get further into the topics and read more about them.

What’s got you motivated in 2015?

This question looked at both the personal and professional side of people’s aims for the coming year.

On the personal front there were some interesting and enviable responses. Procurious HQ will admit to being jealous of Peter’s travel plans, while agreeing with Antoinette in hoping that all our members will be enjoying time with friends and family. And don’t worry Georgia – none of us are particularly green-fingered either!

Professionally, 2015 seems to be a year for development. A couple of common threads were social media and digital strategies and how these are going to impact working lives. The use of social media is on the rise in organisations and many are looking at specific strategies to manage their profiles and presence.

At Procurious, we think there’s a great chance for procurement to be an early adopter and lead the way for businesses. Why not think about a Procurious workshop on social media for procurement.

Also on the professional front, motivations for 2015 included fresh starts, either in a new role, or after some time off (good luck, David!), increasing the profile of public procurement, developing skills through e-Learning and removing silos in businesses through working on internal relationships.

Also remembering the importance of external relationships, networking and meeting fellow Procurians!

Tips to stay on track – make a plan, don’t make excusesrespect your abilities and chipping away at your goals.

I will be starting out as a new face in procurement in May 2015. Any advice on how I can and should be preparing myself?

We’ve all been there at the start of a new job or when we moved into procurement, so unsurprisingly this question was well answered.

Top answers from the community included:

  • Reading about procurement and your new company and understanding their policies and processes
  • Never being afraid to ask questions (there is no such thing as a stupid question!)
  • Speaking to experienced professionals to learn from them
  • Finding a mentor to help you out

Social media can play a big part in this process too. It allows you to connect with and ask questions of experienced professionals, develop your knowledge through eLearning and follow news stories – either via industry publications or #procurement on Twitter.

Other things the community suggested included:

  • Finding templates for policies and processes
  • Understanding how the procurement process fits in the organisation
  • Getting your hands dirty straight away and get out and see the other functions
  • Performing basic spend analysis to help give you a quick overview of the company spend
  • Thinking about the end-to-end process including sourcing and assessment of vendors, payment and delivery terms, risks and how to mitigate/manage them.
  • Remembering that your face and your voice are the ones of your company

It’s often overlooked that it can be challenging starting a new role or in an unfamiliar profession and, as a result, individuals can struggle to adjust to new ways of working or feeling like they are capable.

However, these tips aren’t just for new starts. Even people who have been in procurement for a longer period of time can still learn from this and put these tips to good use.

Hope that helps, Zach! And good luck!

Helpful links

Get involved with a workshop on social media for procurement – (https://www.procurious.com/blog/procurious-news/procurious-announces-webringthedonuts-campaign)

Kick off your learning on Procurious with our ‘Introduction to Procurement’ videoshttps://www.procurious.com/class/all

What can you do in 2015 to make the most of social mediahttps://www.procurious.com/blog/procurement-news/procurement-in-2015-a-new-years-revolution

Getting the most out of networking – https://www.procurious.com/blog/procurious-news/step-up-your-networking-game-the-basics

Know what other skills you might need in procurementhttps://www.procurious.com/blog/life-style/job-survival-skills-get-a-grip-on-the-numbers

What are the biggest global challenges in 2015?

WEF summit to look for answers to major global challenges.

Biggest global risks in 2015

Water crises, interstate conflict and climate change number among the top risks that the world will face over the next twelve months. This is according to the Global Risks 2015 report that the World Economic Forum has readied ahead of its summit on 20 Jan.

Emerging technologies were also cited in the forward-looking document, an area that’s come under considerable scrutiny of late owing to the numerous cyber attacks (hacks) made against major organisations.

The report was put together (in part) by Marsh & McLennan Companies – a representative commented: “As a company you are not protected [against cyber attacks] unless your supply chain is protected.” 

We’ve compiled a collection of tweets around the highlighted issues (as well as some educated guesses) that are all expected to come out of the 2015 discussions.


5 minutes on Procurious – a primer for new members

Following on from our call to step up your networking game, we’ve published a quick, digestible guide to spending five minutes on our network.

Five minutes on Procurious

If your Community Feed is looking a bit empty, then that big green ‘Build your Network’ button (1) is your friend…  We’ve waxed lyrical on the benefits of this tool in the past, see here. Invite your LinkedIn contacts, send a personalized email link, or use the filters to select members by country/industry/category.

For instant gratification, can we instead draw your attention to ‘Get Connected’ (2). This presents a selection of Procurious members we think you should connect with. Click ‘View more’ when you’ve exhausted the recommendations.

Got something you want to get off your chest? Post a status update (just like you do on LinkedIn/Facebook, or send a Tweet on Twitter) to your Community Feed. Just start typing at the ‘Share your thoughts’ prompt (3). Don’t feel like you need to be restricted to text either. Feel free to post a fun/informative/thoughtful photo, or upload a document that you’d like to share with the rest of your network.

Posted a status? Great! Hopefully other Procurious members will take a shine to it and comment (4). Try it yourself by leaving a comment on a post in your network.

Remember, you can tag other Procurious members in comments and statuses by prefixing with the @ symbol.

If commenting on statuses isn’t enough for you then look to ‘Latest discussions’ (5). Here you’ll see a list of the most recently submitted discussion topics that Procurious members have posed.

Click into the topic to answer and air your thoughts. You can also elect to follow discussion topics, and share them to your Community Feed if you so wish.

See something in your Community Feed that you like? Click the thumbs-up to give it your seal of approval (6), or click the share icon to repost to your network.

How falling oil prices are impacting Procurement and Supply Chain

How falling oil prices are impacting Procurement and Supply Chain

According to the BBC, the price of Brent crude oil has fallen to a new six-year low this morning. The price of a barrel dropped by a further 3% to $48.54, its lowest level since April 2009. Goldman Sachs have also stated that they believe the price of a barrel will stay around $40 for the first half of this year.

How falling oil prices are impacting Procurement and Supply Chain

Why is this happening?

Well, in short, the global demand for oil is falling due to weakened economies, increasing efficiency and a move away from oil to other fuels. There is also a surplus in production due to America’s fracking programme and high output in Libya and Iraq despite instability.

Personal vs. Professional

So while it may be a cause for personal celebration when we fuel up ours cars, what does it mean for us all professionally?

Supply Chain and Logistics organisations should see the benefit of falling prices at the pump, while procurement in other areas should see falling commodity prices and lower costs.

However, for those people purchasing travel for their organisation it’s not such a celebration. It is widely expected that travel, particularly air travel, will not benefit from lower prices, as airlines tend to purchase fuel in advance to lessen impact from price shocks.

The picture is also not so rosy for major oil companies. Most are now likely to have to rethink investment decisions and step up cost-cutting programmes. Onus for this cost cutting is likely to fall on procurement and suppliers.

Moreover, we need to consider our suppliers’ position if the focus is on cost cutting. Deflation in industries such as food and beverage and FMCG, is already causing issues for supply chains. An early example of this is in the dairy industry, with First Milk delaying payments to suppliers by 2 weeks due to falling prices and cashflow issues (http://www.bbc.co.uk/news/uk-30771288).

What can we do?  

1. Focus on relationships and partnerships, not just cost cutting. Supplier Relationship Management can play a big part here (https://www.procurious.com/blog/in-the-press/three-key-insights-on-the-importance-of-srm).

2. Work out where you can add value. Deloitte offered a broad range of thoughts in their 2014 CPO Survey (https://www.procurious.com/blog/in-the-press/procurement-time-to-move-through-the-gears).

3. Be more open to innovation from suppliers. It’s not something that procurement are traditionally good at, but there is value to be found by working more closely with suppliers (https://www.procurious.com/blog/trending/2015-will-be-about-innovations-in-the-logistics-world).

Read on for more of the biggest stories commanding headlines right now:

How sloppy security exposed Apple’s supply chain secrets

  • Incredibly sloppy security at one of Apple’s key suppliers exposed some of Cupertino’s most closely guarded secrets to anybody who could conduct a simple Google search.
  • For months, one of Quanta Computer‘s internal databases could be accessed using usernames and a default password published in a PowerPoint presentation easily found on the Web.
  • The path to Quanta’s database started last September when, on the eve of the big Apple Watch launch event, an anonymous Reddit user posted drawings and details of the super-secret device.
  • The document dates from January 15, 2013. It describes a Quanta database for managing the environmental aspects of products and components. The PowerPoint presentation appears to have been made to show Quanta’s customers how to log in and use the system. Incredibly, it includes a link to the database and details of the usernames and default password for at least two customers, including Foxconn, Apple’s main manufacturing partner in China.

Read more at Cult of Mac

Self-driving trucks to revolutionize logistics

  • DHL Trend Research has launched their latest trend report, titled “Self-Driving Vehicles in Logistics”, which takes readers on a journey of discovery, highlighting the key elements and incredible potential of autonomous technologies.
  • DHL plans to “maintain pole position in the world of self-driving vehicles,” wrote Matthias Heutger and Markus Kueckelhaus, the authors of the study. “The question is no longer ‘if’ but rather ‘when’ autonomous vehicles will drive onto our streets and highways.”
  • A boom in electronic commerce is making it harder for delivery companies from DHL toUnited Parcel Service Inc. (UPS) to satisfy consumers who expect first-attempt delivery even though they’re not home during daytime hours.

Read more at Supply Chain 24/7

Jaguar to create 1,300 manufacturing jobs with new sports car

  • Lode Lane plant in Solihull will receive largest investment in its 70-year history as manufacturer unveils plans for ‘practical five-seat vehicle’.
  • The new sports car, which will go on sale next year, will follow this year’s launch of the Jaguar XE sports saloon, also produced at Lode Lane, which has seen several thousand new jobs created in recent years.
  • The XE will create 1,700 in-house jobs at Solihull, 700 more at parts supplier DHL and well over 2,000 in the supply chain. Jaguar Land Rover chief executive Ralf Speth said: “Today’s announcements once again demonstrate our commitment to the UK and the advancement of a hi-tech, high skilled, manufacturing-led economy.
  • The Lode Lane facility incorporates Europe’s largest aluminium body shop and final assembly hall, collectively the size of 22 football pitches.

Read more at Birmingham Post

Industry shake-up as policy uncertainty forces a quarter of businesses out of the wind

  • FTI Intelligence has published its latest renewable energy publication: Global Wind Supply Chain Update 2015. The Update is part of a series of data-driven publications evaluating competitive markets, policy, finance, technology and business models across the energy spectrum.
  • The report examines the supply chain situation for 12 key components (350+ suppliers) and three key materials (150+ suppliers), which account for more than 95 per cent of a wind turbine’s total cost.
  • One of the key findings tells of the delicate balance in the offshore wind supply chain at present. Challenges remain in the medium-term – one third of the cost reduction of offshore wind energy partially relies on supply chain industrialization for disruptive technologies and key elements including the offshore wind balance of plant. This ambitious target is, however, unlikely to be achieved without long-term market stability.

For more info (and to access the publication) head here

Step up your networking game: the basics

It’s a New Year so what better time to step up your networking game and make a splash among your peers.

Invest just a little time into sprucing up your Procurious profile and you have an effortless method of spreading your online influence.

How to build your personal brand online

Is your profile up to scratch?

First thing’s first, make sure you have a profile picture. The idea behind social networking is to make meaningful connections with people – so if you’re looking to strike out in this game, your peers will want to see who they’re talking to.

From your Profile page just click ‘Edit Profile’ to get things rolling.

Here you can choose a profile picture (or pick a new one if your existing one is getting old-hat), and add a header photo to your page if you so choose.

Just remember that you can move and resize the boundaries of your chosen pic as you see fit – make sure to select ‘Save Selection’ before moving on.

Tell us your story

You wouldn’t pick up a book without reading the blurb, or go and see a film without glancing at the synopsis first… So why leave your ‘About Me’ blank?

We’ve seen it time and time again on Procurious – this is your opportunity to tell other members a little bit about yourself.

Enter the desired information using the ‘Edit Profile’ page. Go nuts, it’s your stage!

How to add a profile picture

Make sure you’re contactable

We hope you find the Procurious messaging system useful, but we appreciate there are times when a direct email is the preferred option. To that end, make sure you have an active (and current) email address as your main point of contact.

You can add additional email addresses to your Procurious account quickly and easily on your ‘Settings’ page.  If you move company, or get a new email provider that’s cool too – just select the ‘Make this address primary’ option. Remember, you can add up to 3 email addresses to use as your Procurious login details.

If comfortable with it, why not leave your Skype handle or business telephone number too?

Import your work history

Gaps in your work history might be understandable to you, but look bad to other professionals. Save yourself a job by copying over all your essentials from LinkedIn.

When you registered on Procurious you were given the option to link your LinkedIn account to your profile. If you ignored this in the first instance don’t worry, it’s as easy as clicking a button.

Look to the top of your ‘Edit Profile’ page and press the ‘Import LinkedIn Profile’ button. Easy.

Connect your Procurious profile to other networks

Share your Procurious updates on other social networks

If you’ve got something to say then why not shout it from the top of your lungs? If you’ve successfully connected your Twitter, Facebook or LinkedIn accounts to Procurious then you’ll benefit from the extra amplification that these networks offer.

Manage what you put out on other social networks by scrolling down to the bottom of the ‘Edit Profile’ page and unlinking the accounts of your choosing.

Procurement: time to move through the gears?

That is the question that Deloitte’s 2014 Global CPO Survey posed…

Results from Deloitte’s 2014 Global CPO Survey

Something of a annual staple, the Deloitte Global CPO Survey report reflects the views of 239 chief procurement officers and company directors from 25 countries around the world.

Of those CPOs polled, almost six in ten think their existing teams lack the necessary skills to successfully deliver their organisation’s procurement strategies. The skills most lacking? “Leadership, influence, communication and relationship building.”

To further exacerbate matters 57 per cent also have issues with their own processes and technologies. Not an altogether pretty picture is it?

Happier news comes out of the UK with Deloitte chief economist Ian Stewart suggesting the fair isle will enjoy decent growth through 2015:

“Chief financial officers expect 2015 to be a year of investment and of recovering real earnings… Going into each year, from 2008 to 2013, finance chiefs’ main concern was the state of the UK economy. Now the risks are seen as lying elsewhere.”

Paul Feechan, office senior partner at Deloitte in Newcastle expanded on these ‘risks’ and provided some context: “The central challenges facing the UK’s largest companies as they enter 2015 are policy uncertainty at home and economic and geopolitical risks overseas. Rising levels of uncertainty have caused a weakening of corporate risk appetite which, nonetheless, remains well above the long-term average.”

Indeed, out of the respondents one in four CPOs felt threatened by geopolitical risks (citing recent events across the Middle East and in the Ukraine).

These risks are felt the world over… The Financial Times invites top economists to weigh-in once a year with their thoughts on the year ahead. Looking towards 2015, a majority of its respondents indicated that the threat from political uncertainty would likely affect business and in-turn consumer confidence.

But 2015 won’t be all doom and gloom: “Corporates believe that the long consumer squeeze has ended” – so says Paul Feechan, Senior Partner at Deloitte LLP.

“CFOs expect 2015 to be a year of investment and of recovering real earnings in the UK. Corporate and consumer spending look set to lend the UK economy important support, suggesting the UK will post decent growth through 2015.”

Feechan concluded: “CFOs are also predicting a buoyant year for business investment, with an average growth of 9 per cent forecast for 2015. Following growth of 8 per cent in 2014, this would put the UK at the top of the league for investment growth in the major industrialised nations and, if realised, will take the share of UK GDP accounted for by business investment to a 15-year high by the end of 2015.”

James Gregson, UK head of sourcing and procurement at Deloitte, said:

“The businesses they [CPOs] are serving are changing. Expectations are rising year on year and relatively small-sized procurement functions with a traditional set of skills are no longer the panacea answer to serving that broader agenda.”

“We are seeing a greater level of specialist skills being created in procurement functions. Rather than a very dominant category management structure, which has been the main quest over the last 10 to 15 years, I think people are starting to challenge the category management organisation and look for specialist skills in certain areas, and looking at partnering with other organisations or looking at shared services that can deliver these things more quickly.”

Gregson further commented: “Traditional blocks around category management are no longer the organisation structure of norm.”

And as for procurement ‘moving through the gears’ – Gregson offered:

“What is clear is this whole principle of procurement having to go through the gears, creating different means of delivering the value proposition. That multitude of different levers they are having to pull, the agendas they have to serve is putting a huge strain on the traditional procurement organisation.”

What of these so-called ‘procurement levers’? Those polled cited the following areas as attracting the most interest:

  • Consolidating spend – 40 per cent
  • Increasing competition – 37 per cent
  • Increasing the level of supplier collaboration – 34 per cent
  • Restructuring existing relationships – 34 per cent

You can view the full report here http://www2.deloitte.com/uk/en/pages/operations/articles/cpo-survey.html

Procurement in 2015 – A New Year’s Revolution?

A very Happy New Year from everyone at Procurious HQ.

We hope you, like us, enjoyed the break, over-indulged on Christmas chocolate and good cheer and have come back to work refreshed and ready to make 2015 the year for procurement.

New Year resolutions for 2015

We had some great content published over the holiday season, including some great ideas for what you as a procurement professional could be thinking about for the coming year. In case you missed it, here’s a quick recap:

Make sure that a Work-Life balance isn’t just something that happens to other people – https://www.procurious.com/blog/life-style/how-to-achieve-the-perfect-worklife-balance-for-a-productive-2015

Consider what other skills you might need as a procurement professional – https://www.procurious.com/blog/life-style/job-survival-skills-get-a-grip-on-the-numbers

Find out what it takes to be a great procurement boss – https://www.procurious.com/blog/procurement-news/what-makes-a-great-procurement-boss

Get your category approach right and reap the benefits – https://www.procurious.com/blog/procurement-news/category-approach-simply-tactical-excellence

Also, here are a few recommendations on how you can get the most out of Procurious this year:

  1. Complete your profile – if you haven’t already, add a picture, location and category so you can connect with the right people and they can find you too!
  2. Find an event near you by looking at our Events calendar – this is a great way to connect with fellow Procurians in person!
  3. Start or contribute to a discussion – if you have a burning question or want to share your thoughts, this is the way to do it.
  4. Check out our Groups – find a group that is specifically for your category, location or job and connect. Can’t find one for you? Why not create one and invite people to join.
  5. Top up your skills – check out the Learning hub for videos and podcasts. If you think we’re missing something, let us know.

We think this year is going to be a great one for procurement. Play your part and get involved!

China starts military procurement website to boost transparency

  • China started an official website to make some of its military procurement public, revamping a system that officials say encouraged opacity and corruption.
  • The website, which went online yesterday, contains a list of more than 350 items from satellite surveillance equipment to domestic-made information systems that will be procured by the military. The site is manged by the General Armament Department of the People’s Liberation Army.
  • “It’s a fresh start to make the military procurement transparent,” Yue Gang, a retired PLA colonel, said in an interview. “The lack of efficiency in military spending worries the top leaders as a major source of corruption.”
  • The overhaul of military procurement procedures aims to get qualified, private businesses involved in weapons research and production in a bid to improve competitiveness and efficiency, the official People’s Daily reported, citing Feng Danyu, director of the planning department of the PLA’s General Armament Department.

Read more at Bloomberg

Tesco to reveal new supplier payment system as fears of second-half loss grows

  • In the wake of a terrible 2014 for the retail giant, Tesco is preparing itself to overhaul the way it organises its supply chain.
  • According to the Sunday Times, which quotes senior sources, Tesco chief executive Dave Lewis plans to unpick the complex system of rebates and penalties used to extract money from suppliers, replacing it with a far less complicated structure built around sales volumes.
  • The Sunday Times’s insider also claimed the shake up would make Tesco more popular with suppliers, leaving rivals with the choice of following suit or sticking with the status quo.
  • Tesco has had a torrid time recently and Christmas sales figures are unlikely to offer much respite. A significant drop in like-for-like sales – perhaps as much as four per cent – is expected, which could be enough to push the company to a second-half loss on its British operations.

Read more at CityAM

European supply chain tackles counterfeits, says Converge

  • The aerospace and defence supply chain has a new certification for independent suppliers and distributors, which will dramatically change the industry for suppliers to high reliability markets.
  • SAE AS6081 Counterfeit Avoidance Standard has been in the pipeline since 2007, when the US government began to investigate counterfeit electronic components entering the Department of Defence (DOD) supply chain and the G-19 committee of the SAE was formed.
  • The committee developed a document that would standardise requirements, practices, and methods related to counterfeit parts risk mitigation. Whilst the AS6081 standard originated in America, the issues are global and the certification due to be launched in the coming months is designed to have an international scope.
  • “This will change the industry dramatically; all independent distributors who wish to supply the US DOD must comply and we expect that the global industry will follow. AS6081 is a very tough certification to achieve and few of the thousands of independent distributors in the market will be able to comply with it,” said Eric Checkoway, general manager and vice-president of Converge, the independent distributor owned by Arrow Electronics.

Read more at Electronics Weekly

Sainsbury’s and GLA team up to fight supply chain exploitation

  • Retailer Sainsbury’s is working with the GangmastersLicensingAuthority to address labour exploitation and modern slavery in the supply chain.
  • The GLA is providing tailored training for suppliers to the supermarket to help them identify hidden exploitative practices at farms, pack houses, processing plants and factories.
  • Paul Broadbent, chief executive of the GLA, said: “There is a real commitment and desire on both sides to identify any practice that subjects workers to exploitation. “By raising awareness through training, Sainsbury’s is showing a determination to identify any issues of concern. I applaud them for this and will continue to work alongside them to tackle it.”
  • The pilot scheme builds upon the protocol between retailers and suppliers launched by the UK government in October 2013.

Read more at Supply Management

Logistics Academy launches in Dubai

  • Logistics Executive Group has reached a major milestone with its global Logistics Academy recently completing its first course in the Middle East.
  • Organised as a result of a partnership between Logistics Executive Group and Iconis Learning & Development, a leading worldwide training organisation, the workshop was delivered in Dubai by Iconis directors David Rowlands and Jon Spencer, who possess over 50 years of learning and development experience between them.
  • The course included two half day interactive sessions focused on developing emotionally intelligent leadership and employee engagement skills.

Read more at Arabian Supply Chain

Rakuten, Alibaba and Amazon: the battle of the electronic storefront

Will logistics issues and complications in the supply chain derail the great pretender(s) ascent to Amazon’s throne? 

Alibaba_Corp

It’s been a good year for founder of the Chinese e-storefront Alibaba – Jack Ma. Ma made more money than anyone on 2014’s rich list – his wealth increased by a colossal 173 per cent ($18.5b) to a total of $29.2b.

But if it intends to break out of China and rival Amazon’s market dominance, are there any obstacles likely to hinder its progress?

Forbes analysts have been looking forward and make the following estimates: “Alibaba’s top-line to expand rapidly driven by enormous growth on its Chinese retail marketplaces.”

It continues: “We estimate China’s Internet penetration rate to surge from around 50% currently to over 65% in the long-run. Additionally, we forecast the number of online shoppers in the country to expand from 302 million in 2013 to more than 700 million by the end of our forecast period. This demand will be buoyed by ease of shopping online, heavy discounting, secure payment mechanisms, fast delivery methods, and an increase in disposable income in the country.” 

Another interesting point to note: “Alibaba does not have to invest as heavily in warehousing and distribution centers unlike other pure-play online retailers which own inventory such as Amazon.”

Amazon vs Alibaba vs Rakuten

Elsewhere, Industry Week commented:

“The jury is still out as to how aggressively Alibaba can move into the US market, largely due to the fulfilment and customer satisfaction footholds held by Amazon and other e-retailers: such as Wayfair. This is not to mention the e-commerce channels of traditional brick-and-mortar companies: such as Macy’s and Walmart.”

“Essentially Alibaba’s role is to coordinate track-and-trace logistics, giving coordinate information for delivery, tendering the funders and clearing it – much like what Amazon does when they sell goods for a third party. Much of Alibaba’s huge share of the market in China is within rural communities, where they don ‘t have to deliver goods within a day or two. They’ll need to establish partnerships with carriers, affiliates and more infrastructure here in the US.”

Industry Week noted that logistics handlers such as UPS and FedEx are unlikely to afford Alibaba the same price breaks it gives to those with established relationships (like Amazon for instance). Someone would need to pay the freight costs – therefore that loss will ultimately either lie with Alibaba, or perhaps go back to the manufacturer. Either way, it’s not an ideal scenario.

rakutenEcosystem

But it’s not just Alibaba that has its sights on Amazon’s throne, Japanese giants Rakuten certainly have grand designs…

Here CB Insights shines a light on Rakuten, and analysed the marketplace’s previous investments:

“Since 2009, over 50% of all acquisitions have been within the eCommerce space, however it has been pushing the firm into other areas. Acquisitions not directly in the eCommerce industry taxonomy included the Alpha Direct Services for supply chain & logistics, and cloud-based technology for on-demand video services (Wuaki.tv). It also gained a network of fulfillment centers in the US.”

Interestingly over a five-year period Rakuten has made no less than nine acquisitions in the eCommerce sphere – spread across eight different countries.

Those of particular note included:

  • In the US: Buy.com (California) and PopShops (Washington)
  • Tarad.com (Thailand)
  • Play.com (UK)
  • PriceMinister (France)

If what they say about competition is true – in that it’s healthy, then these developments must come as welcome news to the multitude of manufacturers, suppliers, importers and exporters for whom such storefronts work hard to attract and make part of their success.