Technology

Sustainability in Sourcing Part II: Sourcing's Role

An image of a glass globe in the forest.

In previous blogs, SIG has covered the basic concept of sustainability, including an overview of its various dimensions. In this post, I will touch on the role that sourcing professionals can have in meeting corporate sustainability goals.

Why should sourcing have a role?

Sourcing is uniquely positioned to contribute to meeting a corporation's sustainability goals because sourcing typically has expertise in:

  • Creating alignment to corporate goals
  • Building frameworks to measure success
  • Researching market conditions and supplier capabilities
  • Conducting strategic negotiations 
  • Designing innovative methods for value creation
  • Ranking the priorities of stakeholders with supplier offerings   
  • Identifying risk and mitigating responsibly

The reduction in costs after implementing a sustainability program can exceed the costs of implementation – in other words, you’re spending money up front but in the long run, you save more than you spend. For example, if an organization were to target the spend category of corporate services and facilities management (FM), capital may be invested in working with a supplier to install a new system that reduces energy consumption at the company's North American headquarters, but in the long run, the reduction in energy costs saves the company money – which of course, can then be reinvested.

In this example, procurement and sourcing are uniquely positioned to make this happen. Most likely Sourcing negotiated the original FM contract, understands the innovative capabilities of suppliers, has heard many recent pitches on new products, and is adept at performing the analysis that proves an investment can have a significant return in hard costs, and even soft costs.

Mary Zampino, Senior Director of Global Sourcing Intelligence

How Best-In-Class Procurement Organizations Are Driving Their Category Management Implementation

A futuristic image of a city at night.

Given the intensity with which companies today are focusing on innovation and profitable growth, it is imperative that procurement teams drive strategies that support enterprise-level business goals. Beyond traditional sourcing approaches, strategic category management delivers a collaborative way of developing solutions that support both business and category objectives. Category management maximizes category value to the organization, delivering on critical parameters such as total cost of ownership, risk and performance, to name a few.

While procurement organizations around the world realize the significance of building an advanced category management program, getting there isn’t simple. In a number of organizations today, category management is still at a nascent stage, perhaps indicating that though there is an organizational structure for category management, it is not quite aligned with the business strategy. For many though, exhausted sourcing strategies turn out to be their biggest hindrance.

To address this issue, GEP and SIG have teamed up for a webinar with Biju Mohan, vice president of GEP Consulting, to discuss the latest trends influencing strategic category management program design and implementation by global, market-leading procurement organizations.

Key topics include:

Edie Sachs, Senior Marketing and Content Manager, GEP

The Innovative CPO’s Road Map

A blue circle with digital features.

Procurement has evolved to become more strategic and collaborative and has moved from an isolated, back-office function to a boardroom partner. While the procurement function must continue to drive hard savings, manage suppliers and mitigate risk, it must also pivot to look for opportunities to deliver future savings and innovation.  

“Procurement is at an inflection point,” said Dr. Marcell Vollmer in a recent interview with SIG CEO Dawn Tiura. “Procurement needs to transform into a value-added function focusing on strategic tasks.” How can procurement teams do this?  

Based on interviews with today’s leading procurement executives, innovative suppliers and academic research on the procurement function, five notable areas stand out in which procurement can drive innovation in areas critical to the sourcing industry.  

INVEST IN THE RIGHT TALENT

For all the great advancements that technology brings, it requires people to manage the technology. Oxford Economics’ survey among procurement executives and practitioners found that the top three investment priorities include new talent recruitment, training/upskilling programs and procurement/supply-chain technology.  

Oxford Economics Survey

Stacy Mendoza, Digital Marketing Specialist

Interview with Ryan A. Murray, New York City Mayor's Office of Contract Services

Ryan Murray, First Deputy Director in the Mayor's Office of Contract Services for the City of New York

Ryan A. Murray is the First Deputy Director in the Mayor's Office of Contract Services for the City of New York. He manages an oversight and service agency that was responsible for $21 billion in procurement in FY17. New York City operates a federated model with an estimated 2,000 staff and evolving technology landscape. Mr. Murray leads the people and change practice, serves as the chief strategy officer and guides the legislative/policy agenda for the Mayor's Office of Contract Services.

 
Mr. Murray, who provided the keynote presentation at the New York City CPO Meet and Eat, shares how he is leading the transformation journey for the Mayor's Office of Contract Services to make the procurement and sourcing functions more efficient.  
 

What kind of transformation did you help the Mayor’s Office achieve and how was success measured?

Doing business with the City should be easy and internal city procurement operations should be efficient. Disparate practices across industries, a federated model, rigid bureaucratic rules and heavy reliance on paper processes impede the realization of quality experience by vendors and agencies. That’s why we are implementing a multi-year project to overhaul operations. In 2017 we reached the first critical milestone by launching the Procurement and Sourcing Solutions Portal (PASSPort). Together with our technology and implementation partners, we introduced centralized supplier management, moving a cumbersome vendor disclosures process online, establishing a shared platform for data sharing across agencies and allowing vendors to access contract performance data in the same portal. This success enables us to develop and launch requisitioning, sourcing and payment modules in the next two years.

Stacy Mendoza, Digital Marketing Specialist