Category Archives: Career Management

Hold The Phone! Procurement Pay Increase Smashing The Average Salary

Both ISM and CIPS have released their annual salary surveys. Read on for a short summary of the similarities and differences in salaries across the Atlantic.

Salary surveys make for interesting reading. They reveal much about the perceived value of procurement and supply management, and provide a very helpful data set to have at your disposal the next time you ask for a raise.

If you haven’t seen them already, the two most comprehensive salary surveys for 2018 are available here:

Let’s look at 5 of the most interesting findings across the two surveys:

  1. Average salaries for the profession

  • ISM has announced that the average overall compensation for participating supply management professionals was US$117,425, while CPOs earnt an average of US$263,578.
  • CIPS reported an average salary of £46,422 for procurement and supply professionals, with CPOs earning an average salary of £124,000.
  1. Salary increase smashing the national average

  • In the U.S., ISM reported that supply management salaries rose an average of 4.1% over 2016 salaries, versus 3% for U.S. professionals generally.
  • CIPS found that 68% of procurement professionals received an average 5.1% increase in salary, versus a 2.2% increase for the UK national average.

Paul Lee, Director of ISM Research & Publications, offered the following explanation:

“In today’s global economy, excellence in supply management improves both top- and bottom-line performance, and advances companies’ leadership on the worldwide stage. Supply management professionals’ higher-than-average wage growth reflects the significant value they add every day”.

  1. Certifications DO boost salaries:

  • ISM: Those with the ISM Certified Professional in Supply Management (CPSM) certification averaged 14.7% higher salaries than those without any certification.
  • CIPS: The data reveals that MCIPS and FCIPS professionals have increased earning power, with an average 12% salary disparity between MCIPS and non-MCIPS, and an average of 11% disparity between FCIPS and non-FCIPS across all job levels.
  1. Most important factors when considering a new job

We’re a mercenary bunch. “Salary” has once again come out at the top of both ISM and CIPS’ research into what people consider when evaluating job opportunities. Beyond the money, however, are some other factors that employers should note:

ISM top 6 factors:

  • Salary: 85%
  • Job satisfaction: 81%
  • Improved work/life balance: 80%
  • Benefits package (medical/dental/vision): 79%
  • Pension/retirement plan/401(k) or similar: 78%
  • Organisational culture/work environment: 75% percent

CIPS top 6 factors:

  • Salary: 74%
  • Location: 71%
  • Content of the work: 65%
  • Career progression opportunities: 62%
  • Company reputation: 59%
  • Company commitment to training and development: 58%
  1. Gender gap disappointment

  • ISM’s data reveals women are paid less than men across every level in U.S. supply management, with male CPOs earning 26% more than female counterparts, male VPs earning 52% more than women, and male Emerging Professionals earning 13% more than women.

CIPS reports that the most striking pay disparity exists at the Advanced Professional level, where men earned 33% more than women, a pay gap that has widened since the previous year’s (25%). Pay disparity at the Professional and Managerial levels is also considerable, at 14% and 11% respectively

How To Tell You’re Working For A Psychopath

Psychopaths are present in every workplace. And the higher you go in the organisation, the more likely you are to encounter one.

Working for a psychopath is no holiday. Here’s how to tell if your boss is one, or just a garden variety bully.

A human resources manager is more likely to know them as sociopaths, micromanagers or workplace bullies. I call them psychopaths, not to insult them or even to suggest that they might be chopping people up for fun, but because they share a common set of character traits with all those personality types and also with criminal psychopaths.

1. They are two-faced

A workplace psychopath has a two-faced nature. One face oozes charm and charisma, while the other is viciously mean. They work very hard at flattering those that have power over them, but present a very different face to the people that work for them. To most of their team they are manipulative and controlling. People who work for a psychopath see this face most of the time.

2. They have a pawn

Psychopaths will also recruit a pawn or two. These are people who the psychopath won’t attack, so long as they do their bidding. Frequently it is the pawn delivering the latest piece of manipulation rather than the psychopath themselves. This allows them to put distance between them and their victims and build in automatic plausible deniability if it goes pear-shaped. “No, Terry-The-Pawn was acting on his own initiative, it was nothing to do with me.”

3. They are excellent liars

They are convincing liars and they lie compulsively, often for no apparent reason. The truth to them is whatever needs to be said at that moment. It is whatever they judge their audience wants to hear. And they will have no compunction aggressively assuring you something happened which you know didn’t, often to the point where you will doubt your own memory.

4. They treat employees as dispensable livestock

They treat most people who work for them as dispensable livestock. And this usually causes the cattle (that would be you) unprecedented levels of stress, frustration and fear. When one victim burns out or leaves, they just move on to the next. They damage the health of individuals and the reputation of the organisation without any regret or shame. The workplace under a psychopath is in constant turmoil. Factions are rife, sick leave sky-rockets, staff turnover becomes endemic and productivity drops like a stone.

5. They can’t take criticism

They react to any criticism with aggressive denial or retaliation. If those aren’t options, usually because the critic has more power than them, they will feign victimhood or blame the victims of their actions. Punishment and threats have absolutely no effect on them. They will keep doing things their way, regardless.

In short, they are the classic malevolent workplace bully. This is not to say that all bullying in the workplace is done by psychopaths. Bosses can be mean but it is the frequency of bullying-type behavior that sets psychopaths apart from an everyday horrible boss.
In 2008, UK researcher Clive Boddy from Middlesex University set out to determine exactly how much workplace bullying was caused by psychopaths.

Boddy took a psychopathic checklist and embedded it in a management survey of Australian middle and senior managers. Almost six per cent of the respondents were working with a corporate psychopath as their current manager and thirty-two percent had worked for a psychopath at some time.

A further eleven per cent of respondents were working with managers who showed some psychopathic traits but were not rated at maximum in all categories.

The respondents also revealed how many times they had experienced bullying. Under normal managers, employees encountered bullying less than once a month (nine times a year), but the moderately psychopathic managers bullied employees more than twice a month (on average twenty-nine times a year), accounting for a twenty-one percent of all bullying. If that manager was a psychopath, the employee experienced bullying more than five times a month on average (64.4 times a year) and this accounted for twenty-six percent of all reported cases of bullying.

This means that, as an employee, you can, and probably will, be bullied in the workplace. If your boss is normal, bullying will happen once every six weeks or so. If you are working for a psychopath it will happen once or twice a week, or more. If the behavior described above is happening all the time then your boss is a psychopath. The bad news is that there are not many good options for solving it.

The exit beckons, but while you wait for the right opportunity, there are a number of things you can do to protect yourself and improve your position. Those strategies are the subject of the next part of this series.

3 Ways To Increase Your Procurement Salary

Another day in your procurement job, another day moaning about your unsatisfactory salary… If you want things to change here’s how you take control!

I’ve always said that I’m extremely happy working in Procurement, and there’s no question that it’s great to be doing a job that I’m passionate about.

But no matter how much enjoyment we get from our work – money is always important and a key contributor to our chosen career path.

Of course, you and I would both be happy to double our monthly income; so I thought I’d outline three pieces of advice to help you get there!

  1. Get paid for your value, not your time

Do you have a clear understanding of how your current salary was calculated? Is your employer buying your time or buying your skills?

Many procurement professionals make the mistake of thinking they are paid per working hour. But the main consideration for your employer shouldn’t be  “how hard is this person working?” but rather  “how much value is the person generating for the company?”

So my first piece of advice to you is this: Start thinking about what value you are creating for the company – start measuring it! If you measure your results and your ambitions you have a much stronger argument when it comes to salary negotiations.

Take a look at these two scenarios. If you were to approach your manager to discuss a pay increase, which one sounds more authoritative?

A) I have worked overtime and several weekends during the past six months. I don’t give enough attention to my partner and family. So I think I deserve a salary increase of +20 per cent.

B) I have finalised three major RFQ’s within our category during the past 6 months and  I have reduced prices by 12 per cent per year for our company! I think this performance justifies a salary increase of 20 per cent.

Try to use the employer’s language as in scenario B. Find the arguments and KPI’s which you know they will value the most and think about how you can add influence in these areas. Then all you have to do is impress them with your results!

2. Take more responsibility

Do you enjoy responsibility  or do you avoid it at all costs – letting others make key business decisions for you?

Both behaviors are quite natural. After all, people are different. But ask yourself, what is the main difference between you and your manager at work? Why do they earn a significantly higher salary than you? Many managers have less knowledge and skills than their co-workers and employees, but they are still respected more by the top-executives. How does that always happen?!

The simple answer is that your manager has the responsibility for a much bigger area of the work.

The rule:  greater responsibility = greater salary.

So don’t allow yourself to hesitate when it comes to taking on responsibility. Don’t just wait to be asked, be proactive.

“I heard that our Procurement department plans to run the value stream mapping for Category XYZ. Can I lead this project as I know the processes and steps for VSM?”

“Can I take the responsibility for mapping new suppliers in South Asia, as I already have many business connections there?”

This approach to your work will stand you in good stead to get a significant salary increase when the time comes to negotiate.

Generate profit  for the company

In my experience most organisations consider their procurement department to be the cost centre of the business. Others regard it as a support or service function and,  in the worst cases, they dismiss procurement pros simply as buyers.

But you and I both know that procurement  has an enormous impact on an organisation’s profit.

Whatever your savings are – they contribute to the gross profits of the company. As we say at Future Procurement organisations: “one dollar saved is one dollar earned!”

So how can this knowledge help your salary?

Senior management in your organisation may not understand the value procurement brings to the business and they certainly won’t be familiar with your individual responsibilities and deliverables. They even may not understand the role of Procurement organisation…

But top management of any company cares about profit, this is the language they understand.  So modify your messaging and communicate the extra business profits that are connected to your procurement role.

To sum up; if you want your salary to increase you need to add value to the company, take more responsibility and concentrate on proving the profit you contribute to the company.

Remember; your employer will never care about you more than you care about yourself – it’s sad but it’s true!  Throughout my corporate career, the  biggest salary increases were never initiated by my boss.

Your salary is your own responsibility and if you don’t like it – it’s your problem to fix.

So get out there and fix it!

Gaining Entrepreneurial Experiences In An Enterprise Environment

Look out ‘blockchain’ and ‘transformation’, there’s a new hyped word quickly rising through the ranks – and it may soon eclipse you both: ‘intrepreneurship’.

Intrepreneurship is a philosophy or set of experiences that allow a professional to combine the authority and accountability of entrepreneurship with the (relative) safety and job security of a corporate gig.

There is nothing easy about being an entrepreneur, despite the glamor assigned to meteoric success stories like Apple, Tesla, Uber, and Facebook. The high point and low point of entrepreneurship are actually the same: at the end of the day you are responsible for everything that happens – good or bad – even if it seems beyond your control. This accountability drives healthy risk-taking and builds a sense of ownership that is often missing in corporate roles that provide a soft landing.

Being an entrepreneur sounds like a great idea, but what if it were possible to get that experience without taking on the risk of leaving a position with a guaranteed salary and benefits? That’s where intrepreneurship comes in. Functions like marketing, sales, and operations seem like a natural fit for the intrapreneurial movement, but so is procurement! We just have to be prepared to either seize the opportunity or create one of our own.

Build a better mousetrap…

“…and the world will beat a path to your door” as the aphorism attributed to Ralph Waldo Emerson goes. No one has built more ‘mousetraps’ than procurement, nor have they contracted for mousetrap maintenance services or optimized relationships with mousetrap manufacturers. This knowledge and perspective is priceless to a company trying to create something new that they can introduce to market. The right incremental improvements can turn whole markets upside down. Procurement should have a voice on every corporate innovation council or ‘lab’ and should participate in those experiences as an absolute equal – not a courtesy invite. Realizing how valuable our perspective is, and putting that into words, becomes a ‘business’ plan that procurement can use to drive top line growth.

Identify unaddressed needs

“Wouldn’t it be cool if…?” Procurement spends so much time trying to fulfill defined business requirements that we can often spot unaddressed needs before the company and its suppliers do. Many times, these needs are just to the right or left of current supplier offerings. An intrepreneurial procurement professional will seize this opportunity and partner with a supplier to make it happen – taking on both risk and vision definition and seeing the R&D process through. Procurement’s company is then the first to benefit from the new offering, and may have a stake in the associated intellectual property.

Look, learn, and listen

Procurement’s mandate – in the broadest conceivable sense – is to ensure that the company derives the greatest amount of value, and assumes the lowest level of risk, from every dollar they spend. The projects that might fall under that sort of an umbrella are far more expansive than traditional spend analysis and strategic sourcing. Anything unique going on at the company should include strong representation from procurement.

That includes mergers and acquisitions, new product development, strategy planning, etc. Depending on the project type, there may be an ‘organic’ beginning. Procurement should always be on the lookout for opportunities to take on more responsibility and join in on unique projects – without waiting for a formal invitation. After all, very few people are ‘invited’ to become entrepreneurs. Most chart that path forward on their own.

Once you’ve walked a mile in an entrepreneur’s shoes, it is hard to imagine ever going back and working in a traditional enterprise setting again. And who knows? Maybe the next round of wildly successful, disruptively innovative startups will be founded by former procurement professionals.

Unleashing the Real Power of your Supply Chain

The human element will make or break your supply chain career. Procurious Founder Tania Seary reveals the human strengths that AI will never replace and how to leverage that competitive advantage.

There comes a time when you forget why you ever started.

I’ll never forget my first meeting as a procurement executive with a supplier. For me, it was one of those moments of illumination. I can still remember the desk, the room, (funnily enough, not the particular supplier) and how I felt. I must say, the one word that continually comes to mind to describe what I felt was … power.

Not in a newly-minted supervillain kind of way, but “power” in the sense that for the first time I really felt the tangible ability to make an impact. To tell the truth, I’d had a lot of fancy jobs up to that point – marketing for Walt Disney in London, PR for the Mexican beer company Corona, hosting trade missions for LAX, launching listed companies. But moving from one side of the table from the role of seller to being the buyer … that was a buzz. 

There’s procurement gold in them there hills!

You see, procurement 20 years ago, was – for the first time – sexy. It was on a new trajectory – its very own moonshot. It was a time for firsts.

B2B was all the rage. CEOs and Boards were ponying up millions of dollars to build fancy eProcurement solutions and invest in procurement exchanges. Procurement was coming in from the wild west and being tamed and urbanised through leveraged buying, reverse auctions and blanket contracts. Everything was a first.

MBA graduates were like blurry-eyed prospectors, rushing for the gold fields to claim their stake on their ambitious careers by making their employers a fortune. I distinctly remember asking one of my fellow Penn State classmates, “Why are you going into procurement?” He answered, “Because you can save your company millions and be a corporate superstar overnight. It’s the fastest way to the top.” In other words, “There’s gold in them there hills!”

This is where my passion for procurement started and has continued. Like the chief cheerleader, I have been singing procurement’s praises ever since.

A lot has happened in the last 20 years, but we need to ask ourselves if we’re getting today’s graduates and future leaders excited enough to join our ranks in the search for exponential value? Do they see a bright future in our profession? Because now is certainly the time!

Procurement’s new moonshot opportunity

For the first time in more than two decades, a new moonshot opportunity has emerged for our profession. Cognitive procurement is upon us.

AI and cognitive give us the opportunity to provide a quantum leap in delivered savings. The opportunity to move away from all those back-office administrative tasks that have been holding us back.

Cognitive is going to take away everything we’ve been whining about, launching us out of the transactional malaise and into the strategic stratosphere. Our role in Industry 4.0 will be to orchestrate, collaborate, and negotiate within a complex, technology-enabled global supply network.

Our future will be e-enabled, but humanity most definitely still has a place in procurement. At the odd times when Watson, other robots, and the data seems to be at cross-purposes and pointing us in different directions, we are going to have to step in and use our uniquely human skills to untangle the gridlock of competing interests to find a resolution to the supply challenge.

You see, the secret to our success in Industry 4.0 lies in something that no AI being can match – relationships, along with our ability to leave people with the feeling that they are special, important, and of real value.

As you can see, I’m so excited about the “moonshot” opportunities currently available for procurement. I’m personally energised by my work with IBM on Watson, partnering with SAP Ariba to promote Procure with Purpose and with Procurious itself growing at 25% per year with nearly 30,000 members today and on track to have 50,000 members by 2020.

But of course, in life, nothing is ever perfect.

The human element

My mother is only 71 and has advanced dementia. Many of you will relate to this story. There are lots of things my Mum can’t remember, including most people’s names, what year it is, and how old she is.

But, surprisingly, she can still remember her feelings at different points in her life. She may not remember someone’s name, but she can definitively (and accurately) describe the emotions she associates with that person.

It reminds me of that important leadership lesson: “People may not remember what you said, but they will remember how you made them feel”.

Playing to our human strengths

For me, the human element is what makes business:

  • interesting
  • challenging
  • innovative
  • rule-breaking
  • risk-taking, and
  • friend-making.

For me, the joy of procurement is the personal. It’s the unique relationships I create with people: the deals, the secrets, the preferential options. My relationships are my competitive advantage.

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

We need to embrace our human-ness, our humane-ness, and really get connected with our stakeholders, our suppliers, our teams and our communities.

We have developed Procurious for current and future generations of “Procurers”. We want to empower our future procurement and supply chain leaders to change the face of the profession from the inside out. We’re on a mission to enthuse a new generation, putting new moonshot opportunities through the power of conversation, collaboration, and connections.

Let’s stop worrying about the future and start creating the future we want to live in.

Let’s embrace cognitive and all that Industry 4.0 has to offer. Let’s equip ourselves and our teams to really make a difference with the advanced skills AI cannot – namely the power we have as human beings – or the power to connect.

Procurious Founder Tania Seary delivered this message to inspire audiences at the Procurious Big Ideas Summit in London, SAP Ariba Live in Amsterdam, The Faculty CPO Forum 2018 in Melbourne and ISM2018 Nashville.

4 Ways Procurement Could Better Manage Risk

Procurement pros need to get better at managing risk. Because supply chain disruption can come from any angle, whether it’s caused by a supplier site failure, environmental or geopolitical factors, or even adverse weather… 

If it’s not already, risk management should be a top priority for businesses. The consequences from not actively identifying, managing and mitigating supply chain risk can significantly impact an organisation’s profitability, not to mention brand reputation and potentially, its sheer existence.

riskmethods set out to determine the current “state of risk management and mitigation” in today’s global business ecosystem by surveying more than 250 senior procurement executives from across the globe. The study unveiled important findings around how prepared procurement leaders are to tackle rapidly evolving business environments brought on by new, more complex threats, and the current methodologies employed to manage risk in the supply chain. Here are four areas the survey explored, which indicate where procurement teams are failing in terms of risk management.

  1. Preventing disruption

All senior procurement professionals identify ‘avoiding significant disruption to the supply chain’ as a top priority, but when survey respondents were asked whether their organisation had a significant disruption in the past 12 months, more than 47 per cent indicated that they had experienced between one and five.

Additionally, a surprisingly high 13 percent indicated that they had 20 or more significant disruptions in the past year. Arguably the most alarming statistic – 12 per cent of respondents did not even know whether there were any serious disruptions to their supply chain during this time.

This is a testament to the 12 per cent’s minimal visibility into their operations. According to this data, nearly all organisations faced a disruption in the past year, speaking to the prevalence and nature of supply chain threats at they continue to increase. 

  1. Improve ability to uncover risks

The current landscape has made it critical for procurement professionals to have real-time, thorough views into potential risk and their impacts to make well-informed purchasing decisions. Many organisations have implemented some form of tracking mechanism for risks, but how often the data is updated is another issue.

When we asked respondents about the frequency in which data is refreshed, less than one third of respondents answered continuously. This is an alarming percentage.

Risk monitoring in today’s digital business environment needs to be a 24/7/365 task. Organisations that aren’t receiving continuous updates are falling behind and can’t possibly be making the best decisions for their business.

The underlying cause of this lack of complete information is usually associated with traditionally highly manual processes. Not only is the manual approach an extremely tedious and time-consuming task, it also takes away resources from other critical objectives. Most importantly, it severely limits big-picture insights and increases the chances of a serious supply chain disruption. When survey respondents were asked what level of automation their organisation employed to refresh critical information, less than one per cent of respondents indicated that it is completely automated.

An additional 39 per cent indicated that they were in the low to moderate rage of automation, relying heavily on manual tools such as Excel in conjunction with some outside sources. A full quarter of respondents indicated that they have no automation capabilities at all and are completely reliant upon manual search.

  1. Supplier risk impact assessments are key

Understanding a supplier’s potential impact on the business is key for procurement teams when it comes making purchasing decisions. For example, if a major supplier gets hit by a severe weather event which causes a delay in shipping, that could cause a ripple effect that halts production and eventually leads to a loss in revenue.

When survey participants were asked if their organisation had a mechanism in place for measuring the impact a supplier has on the business, almost half said that their organisation had no structured assessment of supplier criticality or impact.

Having no such assessment means organisations are at times putting their fate in the control of someone’s best guess. Organisations must have clear visibility into their supply chain, including which suppliers have the greatest potential impact, so they can refocus resources on reducing risk and preparing for a crisis.

  1. Organisations must be better equipped to mitigate emerging threats

While being able to identify potential risk is a crucial procurement workflow, having the ability to act on that information and mitigate evolving threats is equally, if not more, important.

Only slightly more than 20 per cent of study respondents indicated they have plans in place. An additional 27 per cent indicated that no such plans exist and 53 per cent indicated that there were only partial plans in place. These numbers demonstrate how difficult it is to evolve into a mature organisation when it comes to prioritising risk because businesses lack the necessary level of stakeholder collaboration.

Supply chains will never be free of risks, but an organisation’s ability to prepare for, identify and mitigate emerging threats will set them apart from the competition. Procurement teams can’t possibly make well-informed business decisions without a risk management strategy in place. As the number of risks continues to increase in this environment, the need for accurate, actionable insights will only become more critical.

When it comes to risk management, companies need to consistently be moving forward as the current threats will only continue to evolve.

Download the report: Procuring Risk: The State of Risk Management and Mitigation in Today’s Global Supply Chain to read riskmethods’ full findings.

10 Questions to Ask in a Purchase-to-Pay Demo

$1 million is wasted every 20 seconds collectively by organisations around the globe. So, here are some areas to dig into and questions to ask during a purchase-to-pay demo. 

$1 million is wasted every 20 seconds collectively by organisations around the globe.

Yes; you read that correctly – organisations are losing money to the tune of $1 million every 20 seconds due to poor project management practices, according to a recent survey from Project Management Institute (PMI).

This same survey also reported that 52 per cent of projects in the last year experienced scope creep, with one of the main reasons being erroneous requirements gathering.

Seeing these stats and given my profession, I immediately thought of purchase-to-pay projects and how procurement and finance professionals can ensure they have what they need when evaluating purchase-to-pay solutions against their requirements document.

With over 7 years in the business, I’ve seen prospective customers led astray by solution providers making them unsure of exactly what they’re looking for in terms of functionality, and more importantly what they need to solve their business challenges.

Sometimes cleverly crafted demos can gloss over important nuances or mask inadequacies, which can cause major problems later during implementation – and the dreaded scope creep. So, here are some areas that I recommend digging into and questions to ask during a purchase-to-pay demo.

10 questions to ask in a purchase-to-pay demo:

  1. Does the e-procurement solution do line item requisition approval workflow? 

That’s a mouthful, so let’s break it down. Imagine you have a user that wants to buy three items requiring three separate approvers in the e-procurement solution. This person fills the virtual shopping cart with these items, just like on Amazon.

But unlike Amazon, these items need to be approved and POs issued before ordering happens. And because you want your users to get the items they need quickly, you want to make sure the e-procurement solution automatically issues POs and places orders as each individual request is approved without waiting for the other approvals – this is line item requisition approval workflow. The alternative is a linear approval workflow where each step is dependent on the previous step, meaning all the POs are held up until that approval workflow is complete.

This means all POs are reliant on the final approval in the linear chain and the entire process slows way down. Ultimately what happens in the latter scenario is your users get fed up with the slowness of the system and start purchasing outside the system – often referred to as maverick spending – so they can get what they need faster and more easily.

  1. Will I be able to create complex workflows? 

Related to the first question is the ability to create complex approval workflows. While the goal should always be to streamline approval processes, certain business scenarios and regulations call for more complexity, and you should not forgo that requirement because the system isn’t sophisticated enough to accommodate. Don’t let the solution provider try to oversimplify matters or sway you with a sharp user interface – what you need is flexibility. The tool should give you the flexibility to create comprehensive workflows that address all your needs – not create multiple work-arounds that you must maintain. You also should be able to configure the workflow once and leave it mostly intact – which is better from a compliance standpoint – instead of having to constantly adjust to meet business needs.

  1. Will I get budget visibility during the requisition or approval process? 

This is a biggie. Perhaps the greatest advantage of automating your procurement and accounts payable (AP) processes is the visibility you get across the entire buying process. But here’s the key – you need that visibility proactively, not reactively with month-end reports. A proactive approach gives managers the visibility to see how purchase requests impact budgets as the requests are being made in real-time, so they can make informed decisions as to whether to approve or deny the requests based on their budget amounts. If managers can only see how purchases impacted budgets at month-end after the money has been spent and budgets used up, that’s a reactive approach and it’s not good enough.

  1. Is the sourcing tool easy to use?

Most purchase-to-pay solutions now offer sourcing as part of the full suite. In terms of value, this helps streamline more of Procurement’s job so they can focus on suppliers and other strategic procurement initiatives. If you’re adding on this functionality to make someone’s day-to-day tasks easier, it should be user-friendly and not more cumbersome than manual sourcing activities.

  1. Can the system perform partial returns?

Say you get a shipment of 10 laptops and one is broken. You want to be able to acknowledge receipt of ten laptops in the system and note the return of the one broken computer. And, you want to be able to track that broken item through the return process. Returns and tracking returns should not be an all-or-nothing process.

  1. Can the invoice automation solution truly process ALL invoice formats?

Remember those cleverly crafted demoes and nuances I was talking about earlier – invoice automation is a landmine for hidden inadequacies. I often hear of solution providers try to mask solution shortcomings by harping on getting more PO-backed invoices, when in reality driving a higher PO percentage is not going to solve your problems. So, let’s be clear about a few things here: you will always have a certain percentage of non-PO invoices and paper/email invoices are not going away just yet, but there’s no reason you can’t automate the processing of those invoice types anyway.

Therefore, you should choose a solution that can truly ingest and process any invoice type automatically (paper, electronic, EDI/XML, PDF, etc. – covering direct, indirect, PO, Non-PO spending) and convert these documents into true e-invoices (i.e. – invoices with structured data formatting for machine reading without human intervention). Your suppliers don’t need to change how they operate today – if they send paper invoices, they can continue doing that – but you can still get an electronic invoice. Automation of this process is key. Leveraging automation should eliminate the need for your AP staff to key invoices into the solution. It should also automate approvals, handle exceptions like extra costs, create all book-keeping information automatically and map the spend accurately to correct categories, regardless of invoice quality and with zero change management for suppliers. This means there is no disruption in the supply chain and you can get 100 per cent of your supplier on-board.

This was a lengthy section of highlighting nuances, but it’s key to understand why this is so important. The point of achieving this level of automation and sophistication in your accounts payable department is to capture 100% of your enterprise spending data by automating all invoices – not just some – so ultimately you get 100% spend visibility.

  1. Can the invoice automation solution do split coding on invoices at the line and header level?

Let’s say you have a trade show coming up. The event is an investment for three departments: marketing, sales and pre-sales. When you’re coding invoices for the event, you want to have the capability to take the sum amount and split it between the three departments. If you can only split at the line level, you will have to split-code each line three ways and that gets to be time-consuming and inefficient.

  1. Does the analytics solution offer out-of-the-box reporting and customisable reports?

You don’t want to reach out to a customer service representative every time you want to see your own financial data in a certain way – that’s time-consuming, annoying and can be costly depending on your service agreement. Make sure the analytics tool offers configurable dashboards and reports that have standard views to provide a starting point for your analysis, allowing you to drill into the details when necessary, and also gives you the ability to easily create, configure and export your data in the format you need.

Analytics should make your life easier – not more complex.

  1. How are upgrades handled?

The advantages of using Software-as-a-Service (SaaS) technology are plenty, but to reap those benefits you have to be receiving upgrades regularly. Ideally, you want to be on a multi-tenant SaaS environment (if you want the real techy stuff, ask the head of your IT department – this person will know exactly what that means). But in short, this enables every customer in the environment to upgrade at the same time to the newest version.

Other environments stagger upgrades for customers, meaning that not everyone has access to the latest functionality and bug fixes (including features that ensure compliance) and worse, they fall behind on their upgrades. This begins to pose real problems due to fragmented support across various versions, some customers opting to skip upgrades and falling further behind and challenges maintaining the solution.

  1. What happens to custom fields during upgrades?

The custom fields you create and the data associated with those fields should remain intact when upgrades occur. You spend a lot of time and energy defining custom fields during implementation; there is no reason your solution administrator should have to go back in and do re-work every time an upgrade happens. This is a waste of time and you risk loss of data capture if those fields are not re-activated in a timely manner.

30 Under 30 Stars Prove This Enduring Stigma Is Disappearing From the Profession

Procurious uncovers the five factors in common across this year’s inspirational group of 30 Under 30 Supply Chain Stars.

Delivering over $20 million in cost savings, building a new procurement function from scratch and creating a cutting-edge suite of analytical tools are among the outstanding personal achievements of 30 young professionals named winners in the ThomasNet and Institute for Supply Management (ISM) 30 Under 30 Rising Supply Chain Stars Program.

This award shines the spotlight on a trend that is taking place in companies large and small all over the globe, where Millennials are being asked to step into senior roles earlier than expected in order to fill the vacuum created as an entire generation of Baby Boomers retires.

The generations in the middle, X and Y, are also moving into executive roles, but the problem is that there simply aren’t enough of them to do so. That’s why Millennials are leap-frogging through the ranks in nearly every profession – including procurement and supply management.

This year’s 30 Under 30 winners have been chosen for unique achievements that are particularly impressive so early in their Supply Chain careers. There are, however, five factors that are held in common across the group.

  1. They’re not afraid to change roles and companies

This year’s group of 30 Under 30 winners provides further proof that any remaining stigma around frequently changing roles (or to use the disparaging term, “job-hopping”) is rapidly dissipating in the profession. Rather than being seen as damaging to procurement or supply career prospects, working across different organisations or varying roles within the same organisation is now recognised as an enriching experience that brings crucial diversity to any team.

Flex’s Elizabeth Richter, for example, completed internships at MeadWestvacso, Kohl’s and Cisco before landing a plum role as chief of staff for the CPO at Flex, a company that she calls “supply chain heaven”.

Examples abound among the 30 winners, with similar stories of experience across multiple companies, while a small handful have remained at a single organisation from graduation to the present day.

  1. They’ve all had experience on strategic projects

In general, the 30 Under 30 have rocketed beyond the role of purchasing officers impressively early in their careers. These winners are all strategic procurement and supply professionals, and are being recognised for more than just achieving cost savings but for driving truly game-changing projects. Megawatt Winner Charlotte de Brabandt, for example, successfully coordinated a global team at Johnson & Johnson to find a single global service provider to assist with global energy procurement for 920 sites across three continents. Google’s Neta Berger managed the daily war room meetings that focused on resolving immediate supply shortages after the 2011 Japanese earthquake and tsunami while she was at Cisco.

At Google, Berger has managed materials for international expansion into seven countries of the Google Home and Google Wifi products and was tasked with mitigating risk for the Google Home Mini.

  1. BUT… they still generate significant cost savings

If someone were to total up all the cost savings these young professionals have won for their companies, the figure would prove once and for all the true dollar value of a top-performing procurement professional. For example, United States Steel Corporation’s Chelsey Graham (age 27) drove $20 million in cost improvements with a single high-visibility project with manufacturing stakeholders, while Madeline Martin (Mars Petcare) has saved an estimated $14 million in her short time with the company.

Every one of the 30 Under 30 winners has a similarly impressive cost savings achievement under their belts, demonstrating that while a strategic lens is important, it’s also vital to retain focus on the bottom line.

  1. Falling into the profession is no barrier to success

Is the fact that many people move sideways into supply management the profession’s greatest strength, or weakness? ThomasNet reports that 60 per cent  of the 30 winners planned on a career in supply chain. The winners include a former attorney, a mechanical engineer, a civil engineer, a technology entrepreneur and even a former chef.

Backgrounds like these can only serve to enrich procurement and supply management team skill-sets, especially when combined with the skills of professionals who have a “pure” professional and educational background in supply management.

Megawatt Winner Charlotte de Brabandt, for example, did not originally plan on pursuing a career in supply chain, but soon discovered the opportunities that the profession could offer. “It quickly became a clear career choice for me [after I’d] led a few supply chain projects in different fields of strategic procurement, project procurement, logistics and quality,” she told ThomasNet.

  1. Some organisations are producing 30 Under 30 winners every year

For those of us who have observed the 30 Under 30 program since its inception, a pattern is beginning to emerge where certain organisations have produced supply chain stars nearly every year for the past four years. These companies, including USSC, Johnson & Johnson, DuPont, Dell and the United States Postal Service, are not only talent magnets in the profession but are gaining a reputation for being fantastic supporters and promoters of their top performers in supply management.

In a previous interview with Procurious, ISM CEO Tom Derry talked about the importance of coaching trees in the procurement and supply management profession.

“Sometimes it’s companies, sometimes it’s individuals”, he said. “Certain CPOs have gained a reputation for coaching and developing people who have subsequently left, and gone on to make their mark.” Their organisations benefit by being seen as an employer of choice for top procurement talent, and the CPOs themselves benefit from the dynamism and vitality of a team made up of the brightest the profession has to offer.

Learn more about ThomasNet and ISM’s 30 Under 30 Supply Chain Stars program here.

Procurious will catch up with the 30 Under 30 winners at the Institute For Supply Management’s flagship event, ISM2018 in Nashville, Tennessee. Learn more about the ISM 2018 Emerging Professions Experience: http://ism2018.org/2018events/emerging-professionals/

4 Realities of a Cloud Spend Management Implementation

Implementing new tools and systems is enough to make the bravest of procurement pros shudder with dread. So what are the four biggest risks associated with cloud spend management implementation…

With a wide array of cloud-based applications on the market, many organisations are saying goodbye to out-dated, legacy systems and adopting new Software as a Service (SaaS) solutions. These tools are changing the game in spend management, providing companies with increased visibility across all areas of spending and identifying new opportunities to drive cost savings.

However, despite all of the obvious benefits associated with these cloud systems, implementing a new tool across an enterprise can still be very challenging. For example, change resistance is often problematic when it comes to encouraging end users to utilise new systems. Without proper planning, you risk running into multiple issues that could derail the process and prevent a successful implementation.

Below are the top four risks associated with implementing cloud-based spend management solution:

  1. Getting Suppliers On Board

To successfully implement a new spend management solution, supplier enablement is imperative. The amount of work that’s necessary to get all of your suppliers on board with the implementation is commonly underestimated. In order to get it right, you should develop a supplier enablement strategy that carefully outlines each step of the process. Make sure you clearly communicate all of the changes that will take place, what your expectations are for suppliers, and how implementing the new tool will improve day-to-day workflows.

  1. Navigating the Integration

Don’t believe all the hype that you hear during sales demo—take everything with a grain of salt and follow up with questions about the integration process. Even if the integration sounds simple, remember that somebody has to do the work. There are several things to address regarding integration: Who is doing the mapping and file transformation? Which Enterprise Resource Planning (ERP) system will be used? Whose standard is being adopted?. You will also want to learn the integration method and inquire about any limitations per integration object. Make sure the vendor spells out all of these details before you sign a contract. This will guarantee you aren’t met with any unwelcome surprises down the road.

  1. Achieving End-User Adoption

Although it has become much easier with SaaS-based source-to-pay (S2P) and procure-to-pay (P2P) systems, achieving end-user adoption is still one of the biggest challenges that organisations face when implementing a new tool. The resistance to adoption typically begins when specific use cases are overlooked or not addressed appropriately. Lack of support from senior leadership, poor communication, and inadequate training can also be roadblocks to end-user adoption. You can avoid these roadblocks by considering all applicable use cases and crafting a detailed communications plan that includes all key stakeholders.

  1. Addressing All Use Cases

To avoid resistance and ensure your new spend management tool is meeting your needs, make sure you have selected a solution that will address each unique use case. Ask yourself: Who will be using the tool and for what purpose? Simply having an assortment of features and functions isn’t enough. In order for the implementation to be a success, you need to make sure you understand how the tool’s features and functions specifically address all of the use cases to ensure the solution meets your business needs.

Although it’s certainly important to keep these major risk factors in mind, don’t let these challenges get in the way of implementing a cloud-based SaaS solution at your organisation. Creating a carefully outlined implementation plan will help mitigate risks and ensure the process goes smoothly for everyone involved.

Are you having trouble selecting a new spend management system or navigating a complex integration? Contact RiseNow today for a free supply chain consultation to help get you started.

This article, written by Matt Stewart, was originally published on Rise Now 

3 Ways To Keep Up with the Social Media ‘Joneses’

What do you mean you had time to read The Economist cover to cover – don’t you have a job to do??! Kelly Barner advises how you can keep up with the Social Media ‘Joneses’.

We all know one… that person in your network that not only mysteriously has the time to think, read, discuss and be oh-so-intellectual about the day’s leading topics, they also broadcast that fact everywhere. Here are some sample ‘shares’ to give you an idea:

“Really enjoyed this article the third time I read it in this week’s issue of the Economist”

“Back from our week-long innovation retreat / chakra cleansing with a revised vision for procurement”

“Pleased to share volume 4 of my treatise: ‘Reflections on the Meaning of Corporate Procurement’”

Honestly. Don’t these people have real jobs? After reading status updates like these, it’s hard not to feel horribly overwhelmed. Let’s face it – the rest of us are scrambling from top priority to top priority. We’re trying to cover the fundamentals while also finding the time to look for opportunities to create additional value.

Here’s the thing: just as people gild their personal experiences on social media to make it look like they have the ‘perfect’ life, they are tempted to do the same at work. Although you may feel a combination of stress and envy in response to their abundant discretionary time, you can convert that energy into something that is not only productive, but realistic to achieve.

Procurement has long been hesitant to engage on social media (eek! a supplier might be looking!!), but the tide is beginning to turn. Here are some suggestions for how to keep up with the ‘Joneses’ without actually becoming them.

Read One New Thing Every Day (Max investment: 15 minutes)

There is so much content published on a daily basis that it may seem just as easy to let it all float by as to pick something to read. And yet… not reading anything is a huge mistake. Don’t think too hard about your selection – it is wasted time. You’re better off reading something mediocre and moving on than making it an hour long task. There is something to be gained from every piece of content – even if it is so complex or boring that your mind wanders to other topics. Let it go! Stepping away from project-related tasks and phone calls may be just the distance you need to foster a great idea.

Post a Comment (Max investment: 30 minutes)

Not everyone is a writer – and not everyone who writes should. That said, there is just as much value to be realised in commenting on or challenging other people’s work as there is in publishing your own thoughts. If you’ve already invested the time to read something, why not make a comment? We are all made better when we are challenged, and sometimes all it takes to get the conversation going is the first comment. You’ll find that articulating your point of view helps you formalise your thoughts in a way that just reacting in your mind doesn’t.

Host a Lunch & Learn

One of the things we have to give procurement credit for is the abundance of high quality – free access – webinars and podcasts. If you come across one that is relevant to your team, reserve a conference room and invite others to join you. If it is during lunch, encourage people to bring something to eat. If not, grab coffee or see if the company will spring for bagels (people love bagels…) The resulting conversation will move everyone forward and add to the shared knowledge base of the team.

The key thing to keep in mind is that you can learn and grow without shoving it in other people’s faces. If you’re focused on using that investment of time to put yourself above other people, you’re missing the whole point of building virtual community and advancing professional development. Plus, we all know the unspoken reality… the more showy people are about their own accomplishments, the more likely they are to be updating their status from their parents’ basement.