Purchasing Archives - Supply Chain Game Changer™

Strategic Supplier Relationship Management – Do’s and Don’ts

Procurement Don’t go to the Dark Side!

Shortly after I joined the Commodity/Category Management Procurement organization I was invited to attend the annual Strategic Supplier Awards event. It was all about Strategic Supplier Relationship management.

There were Executives from dozens of Suppliers in attendance. The event concluded with award recognition given to Suppliers based on their scoring and standing as being of Strategic value to the company.

Prior to joining the Procurement team I had neither understood nor appreciated the importance of Supplier Relationship management. But having seen how motivated and inspired these Suppliers were I started to understand.

But in the weeks, months and years to come I also became much more informed about the good and bad aspects of Supplier Relationship Management.

From company to company I came to develop a list of Strategic Supplier Relationship Management “Do’s” and “Don’ts”.

Enable Spend Aggregation in Procurement!

Spend Aggregation Obstacle Course for Procurement!

Aggregating your procurement spend for the purpose of delivering greater value is a sound objective. Theoretically you should be able to generate better service, better terms and conditions, and better cost. Therefore you should enable spend aggregation.

Yet there can be many obstacles in your way to achieving this seemingly simple goal. Loss of control, fear of job loss, questionable benefits, and a perceived loss of margin are some of the obstacles you may run across. We discussed these in greater detail in our post Procurement (Part 1!) – The Spend Aggregation Obstacle Course!

Differentiate With Supplier Relationship Management (SRM)!

Strategic Supplier Relationship Management – Do’s and Don’ts

Democratic institutions around the world promote the core doctrine that all people are created equally. This is clearly not the case in the world of supplier management. All suppliers are not created equally and they should all be managed with this distinction in mind. As such you can differentiate with Supplier Relationship Management.

This article on how to differentiate with Supplier Relationship Management will look at a model for stratifying and segmenting your supply base within the confines of a structured and formal supplier relationship program (SRP).

Digital Procurement Ecosystem Creation in 8 Minutes!

What is the Digital Supply Chain?

I was in Paris last week, touring around as people do in Paris, and visited Fondation Louis Vuitton. What does that have to do with a Digital Procurement ecosystem?

If you’ve never been before and are a fan of art, architecture, and culture, I can highly recommend adding it to any future itineraries.

The museum’s collections are magnificent, and the building itself is a true masterpiece. Beyond the artwork, Fondation Louis Vuitton offers an experience to tour the multiple levels of decks that interweave themselves between the inside and the outside of the building’s structure.

On one of the decks sits a piece of artwork named “Where the Slaves Live”. It is a living organism, composed of inorganic and organic materials, forming a ‘living sculpture’ that is a small scale ecosystem- an ever-changing work of art.

Responsible Sourcing! Making Sustainability Happen for Real!

The Green Supply Chain: True Sustainability or Just a Marketing Stunt?

Sustainability and responsible sourcing.

The word with so much focus and buzz surrounding it, it has almost become difficult to speak or write about.

It’s become the keyword that you see in article titles and hit like or share when scrolling by — so your friends and professional network see you care about the future of the earth — but seldom click on the link to read.

Unfortunately, sustainability and sustainable development are beginning to turn from green to grey, considering its ever-increasingly washed-out idealistic applications in business and society at large.

Procurement Integrity Breach – A Sure Way to Get Fired!

Could the CPO Be Replaced by the Chief Value Officer?

The following story about Procurement integrity is true; no names or companies will be mentioned.

“Hello, Rebecca. Great to hear from you this morning. What can I do for you today?” I said to my direct report on my cell phone.

“We have a situation that needs your attention.” Her voice foretold that this was one to pay extra attention to.

“What’s up?”

The Hitchhiker’s Guide to Digital Procurement!

The Digital Supply Chain Road is Full of Potholes, Construction and Accidents!

Navigating the complexity of the global supply chain as a procurement professional can sometimes feel like taking a walk through the Amazon without a compass, or entering into outer space without an oxygen tank, especially when considering digital procurement.

It’s important that procurement teams take into account the new risk reality and challenges that face them, their organizations and their value chains. As the world around us continues to put the pedal to the metal within the digitalization of business solutions, procurement can’t decide to slow down for every speed bump.

At the same time, it’s never smart to punch the gas if you haven’t packed a spare tire. You never know when you might run into something sharp along the way.

Finding the perfect balance between preparation and action can be tricky.

Supply Chain as a Service (SCaaS)!

Preparing Business for the Digital Supply Chain! Oracle Interviews Mike Mortson!

I began my career working in a manufacturing plant within an international company that was completely vertically integrated. From component manufacturing through to subassembly manufacturing and end product assembly they did it all.

Within 10 years the company experienced a number of site closures and declared that manufacturing was no longer a core competency. For the site that I was a part of this meant that closure was an inevitability.

Faced with this stark reality we made the choice to spin off from the parent organization and start our own new company, entering the world of Contract Manufacturing.

This was my first experience with Outsourcing, or what I refer to as “Supply Chain as a Service” (SCaaS).

The Future of Procurement!

The Future of the Chief Procurement Officer … Is Already Here!

There has been transformation in the Procurement function over the past decade. From the starting point of the traditional buy-sell, transaction-based purchasing, the practice has moved through stages of change that redefines most aspects of the business and the future of Procurement.

A typical Purchasing Function is limited to the transactional job of collecting information about the requirements of user departments and carrying out commercial checks and balances to finally procure the product & service based on cost reduction only and focused on supply continuity.

Featuring Our 12 Best Procurement Articles!

Featuring Our 10 Best Inventory Management Articles!

Procurement is a core function in every single company. Whether purchasing goods or services to support the company’s product offering or purchasing goods or services to support the infrastructure and operation of the company, Procurement is key and featuring our best Procurement articles is more than appropriate.

Depending on the type of industry you are in the Procurement of goods and or services can be the largest, or one of the largest, expense areas. As such the ability to efficiently procure goods to meet all objectives of cost, delivery, quality, and more is essential for not only success, but for survival.

In this “Featuring” series article we are putting the spotlight on Procurement and Purchasing. We are presenting our Top 12 best Procurement articles with information, techniques and approaches which will have something for everyone to learn from and apply in their own situation.

What Exactly Is Supply Chain Management? 10 Different Definitions!

What Exactly Is Procurement? And What is Purchasing?

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When I began my career there was no such thing as “Supply Chain Management“. Supply Chain was not a title to be found anywhere on any organization chart.

Yet all of the functions that we now associate with Supply Chain have been around for a very long time: Planning, Inventory Management, Logistics, Procurement and Purchasing, Warehousing and many more.

So what exactly is the definition of “Supply Chain Management”? Interestingly there are many views on how to define Supply Chain.

Manage Procurement Spend Like It’s Your Own Business!

Procurement and Procurement Spend. Purchasing. Commodity Management. Category Management.

They are all running their own businesses within their companies, or at least they should be, whether they realize it or not.

Goods and services spend in many companies is the largest, or one of the largest, expenses. And all of this is managed by Procurement personnel.

But do they manage this spend like it is their own business or do they manage it like it is just a functional job with transactional activities to be performed?

Spend Aggregation Obstacle Course for Procurement!

Enable Spend Aggregation in Procurement!

The theory is simple! If you can increase spend levels through centralized spend aggregation across entities then you increase your leverage in negotiations. This leverage should translate to lower costs and better terms and conditions. But there is a spend aggregation obstacle course to be overcome first.

These entities may be different departments or facilities within your own company. They may be different companies under common ownership. They may be disparate companies within an industry. Or they may be unrelated companies spanning many industries.

The benefits seem clear. So why is there so much resistance when it comes to trying to aggregate spend across these entities?

What Exactly Is Procurement? And What is Purchasing?

Featuring Our 12 Best Procurement Articles!

For his entire career my Father worked in the field of Procurement. But the job titles that he had during his career alternatively included either the word Procurement or the word Purchasing. I seem to recall that one of his business cards included both words.

When I was young I thought I had a somewhat clearer understanding of what my Dad’s Purchasing job was. His job involved buying, negotiating, contracts, overseas travel, sourcing, suppliers, parts, services, managing, supplier qualification, product qualification, terms and conditions, quality issues and delivery problems.

But was that Procurement or was it Purchasing? Procurement sounded like a somewhat loftier and more sophisticated word than Purchasing but by the same token it also seemed like they were synonymous and interchangeable terms.

What exactly is Procurement? And what is Purchasing?

What’s the Difference Between Commodity Management and Category Management?

Commodity (or Category) Management – What is your Buying Strategy?

For a considerable portion of my career I have worked in the Manufacturing and Logistics/Distribution Industries. In these industries a segment of the Procurement organization is called Commodity Management, not Category Management.

However when I entered the Retail industry the group largely responsible for Procurement, amongst other things, was called Category Management.

At its core each group was procuring goods. But while there were shared responsibilities there were also key differences.

So what is the difference between Commodity Management and Category Management?