SIG Speaks Blog

New Priorities for Procurement Leaders

women procurement leaders

Your employees helped you navigate a historical disruption. Now they deserve your investment in their personal and professional development.

Everyone wants to “get back to normal.” I am anxious to safely hug friends and family, talk without the muffling of a mask, enjoy a meal in a restaurant, and travel abroad again. While the saying get back to normal is mostly a turn of phrase, going back to normal in the professional world is impossible.

Procurement professionals are constantly preparing for localized Black Swan events, like natural disasters, geopolitical conflicts, cybercrimes and such. But the impact of COVID is unique in its size and scope. What started as an epidemic in late 2019 quickly spread into a pandemic, consuming the entirety of 2020, and it’s still rearing its ugly head in the world.

Leaders in all sectors need to realize that the world as we know it has changed, and your employees are holding company leadership accountable. If you want to keep the talent you have and be an employer of choice to attract new talent, it’s vital to stop, listen, and learn from the people who help make your business successful.

Here are my recommendations to build a more inclusive, resilient, and agile workforce as we look ahead.

Back to the Office ... or Not

Now that vaccines are making inroads and people can safely congregate again, some look forward to going back to the office full time. After a year of working from home, others don’t want a full-time return to the office.

Before COVID, there was in many companies a conservative attitude about working from home. It was accepted on occasion but not wholly embraced. At Scanmarket, we will not return to a situation where people have to be at the office five days a week. Instead, we will pivot to a hybrid, part-time office model.

Betina Nygaard, CEO, Scanmarket

How to Become a Certified Third Party Risk Management Professional

Earn a third party risk management professional certification through SIG University

SIG University’s Certified Third Party Risk Management Professional (C3PRMP) program is a globally recognized certification that is the “gold standard” in terms of relevance, scope and content. The C3PRMP program was created by Linda Tuck Chapman, an advisor, educator, author and expert, and is based on her experience and her book, Third Party Risk Management: Driving Enterprise Value (published by the Risk Management Association). You’ll soon learn that investing in the C3PRMP designation is an investment that will enhance your knowledge base and deepen your expertise.

Outlined here is information about the upcoming changes and benefits of your C3PRMP designation, as well as a profile of our students.  


 

What is different about SIG University’s C3PRMP program? 

In January of 2020, the duration of SIG University's C3PRMP program was extended from eight weeks to 10 weeks. Multiple-choice review questions at the end of each module will test all students’ knowledge and require a minimum passing score of 80%.

Members of the Global Association of Risk Professionals (GARP) will continue to earn 20 Continuing Professional Development (CPD) credits, GARP’s highest award for a continuing professional development program.

Stacy Mendoza, Managing Editor, Future of Sourcing

Procurement KPIs: The Keys that Unlock the Value of Spend and Supply Management - Part 3

Procurement KPIs and Spend Management

In part one and part two of this KPI series, we highlighted some of the foundational measurements for procurement pros and the problems of traditional procurement key performance indicators in terms of how they can be incomplete, misleading and even damaging to a value chain transformation.

So how do you get from tactical procurement metrics to more powerful spend/supply measures that help build new capabilities and favorably impact critical business outcomes?

We have mentioned some of the more expansive sets of metrics that organizations use to measure several areas:

●      Spend/cost management and savings

●      Supplier/supply performance

●      S2P process metrics for process performance

●      Underlying capabilities in talent management, digital, etc.

●      Stakeholder-specific metrics related to the above

In this third installment, we’ll dive a little deeper into some example metrics, but the first order of business is to provide a framework giving the backdrop on the KPIs and use it to hone in on metric types before listing individual KPIs.

Pierre Mitchell, Chief Research Officer, Spend Matters

Does Your Business Need to Understand Category Management Principles?

Category management tips

SIG University Certified Sourcing Professional (CSP) program graduate Diana Redwine shares her thoughts on the best way to get business stakeholders engaged.


Ugh, here comes procurement, getting in our way again!

In the Tech world, the role of procurement changes with the transition from start-up to a public company. That transition is full of bumps if not addressed with a support mindset.

Somewhere in the timeframe from growth to a public company, experienced procurement talent is engaged to help move spend activities from tactical to strategic. The notion of this is much more grand and idealistic than the reality.

The Idea

Traditionally, handling contracts, licenses, order forms, etc., have been managed by the person with the need, not necessarily by someone with expertise in contract development and negotiation. With procurement added to their toolkit, the business stakeholders might say, “gosh, it would be nice to hand this off to someone else” or “how do I know this is the best price/terms?”

More likely, they have been advised that a new policy is being implemented that requires procurement involvement. However, in my experience, many stakeholders view procurement as an impediment to progress and do not willingly hand off their contract needs. Hence the need to truly consider this question of just what the stakeholders REALLY need to know about category management.

Diana Redwine, Senior Procurement Manager, Smartsheet Inc.

When Leaving Money on the Table is the Best Strategy

cost savings leaving money on the table

SIG University Certified Sourcing Professional (CSP) program graduate William DeMarzo shares his perspective on the old sourcing cliché “don’t leave money on the table". 


In our SIG University CSP course, we learned the benefits of “leaving money on the table” as this negotiation style builds trust, transparency, and a collaborative relationship with suppliers.  Yet, the concept of leaving money on the table seems to be taboo in today’s business environment. Nine of the top ten hits from a Google search of the phrase are articles about why it’s a bad idea, a sign of weakness, or otherwise poor choice to do so. Perhaps this is more a sign of a zero-sum society than a negotiating strategy, but that’s a topic for another essay.

Let’s be clear that there are many business transactions where it is appropriate to pay the lowest price for a product or service. For example, products that have defined specifications, from a #2 pencil to a powerful server, or a service that has a measurable deliverable, should be sourced at the lowest price in the market. But when is leaving money on the table a good strategy?

William J. DeMarzo, Sr. Director, The Bank of New York Mellon

This Month at SIG – June 2021

Here's your monthly update on the latest thought leadership, networking events and training with SIG.

This month we host our June Microlearning Event, have a host of exciting industry research and webinars to keep you up to date.


June Microlearning by SIG University

Microlearning by SIG University is a two-hour immersive session for all levels of sourcing, risk and procurement practitioners.On June 10, renowned third party risk expert, author, and educator, Linda Tuck Chapman, CEO of Third Party Risk Institute, will lead a session on integrating strategic sourcing and third party risk management for high impact results. She will be joined by Tom Ciardiello, a strategic sourcing executive, who will present on the total financial impact of a deal from cost modeling to hidden cost & savings.

Join us for this opportunity to “ask the experts" and gain valuable insights based on tested and trusted methodologies.

 

Power Hour Webinars

Beyond ERPs: How Source-to-Pay Solutions are Changing the Game for Procurement

To manage complexities like the global pandemic, rapidly fluctuating customer demands, and changing regulation and compliance standards, procurement teams require a unified Source-to-Pay solution that offers:

Desmond Williams, Digital Marketing Manager

Implementing Third-Party Risk Management Framework

Third-Party Risk Management Framework

SIG University Certified Third-Party Risk Management Professional (C3PRMP) program graduate Andrea Solano discusses how taking the C3PRMP program helped her to implement the framework for her team to operate as an optimal risk management and risk mitigation function across her department and enterprise-wide. 


 There are different types of workstreams and specializations that have been around a long time. However, the discipline of Third-Party Risk Management is something that is in the very beginning stages of inception. Currently, it is evolving into a discipline that many organizations shall be implementing as a standard operating function in the Silicon Valley business sector I work at. Working at Silicon Valley, the term Third-Party Risk management is still somewhat foreign and not understood as a critical and vital risk management function.

Third-Party Risk Management Function

The key role that I fulfill within the Third-Party Risk Management life cycle is in the due diligence process, which is the internal audit function that serves as a 2.5 – 3rd line of defense within my organization’s Risk Management Function. The SIG University Third-Party Risk Management training that I have taken throughout these past ten weeks has been highly instrumental for me. It will help create, build-out, and develop an internal audit framework that will be customized to meet the needs of this brand-new Third-Party Risk Management function within my organization.  

Andrea Solano, Global Security 3rd Party/Outsourced Audit Manager, Facebook

Sustainable Sourcing 101

An image of a sustainable forest with the sun coming through the trees.

The concept of sustainable sourcing, also known as green purchasing or social sourcing, is nothing new. Sustainable sourcing is impacting nearly every area of corporate business and the consumer’s mindset. Everything from sourcing materials, talent attraction and consumer purchasing habits is changing because of sustainable sourcing growth. However, the term gets thrown around in the procurement industry quite often and is often misunderstood or misused. So, here’s a guide with all the basics you need to know about sustainable sourcing.  

WHAT IS SUSTAINABLE SOURCING

First and foremost, we have to define the term. Sustainable sourcing is the integration of social, ethical and environmental performance factors into the process of selecting suppliers. It includes purchasing sustainably preferable products and services (products made from recycled or remanufactured materials), as well as green purchasing guidelines that might pertain to certain products or commodities.  

Heather Schleicher, Chief Marketing Officer

Getting Optimal Results from Complex Categories: Sourcing Optimization

sourcing optimization for procurement

SIG University Certified Sourcing Professional (CSP) program graduate Tim Johnson details the power of true sourcing optimization within the organization.


It is incredible how many companies are still using a basic RFP platform with minimal scope for optimization. Even the platform Excel has no capacity for optimization or sourcing processes to manage the sourcing of highly complex categories. None of these methods can deliver any substantial savings or ROI.

A simple and easy-to-use sourcing platform is all you would need – even if you are not a sourcing specialist – for a three-bids-and-a-buy sourcing project to source a single item. But if you have hundreds of suppliers and thousands of possible scenarios, a simple platform does not make the grade. As for trying to manage (and more importantly, analyze) complex sourcing events in Excel, that will require a full-time mathematical genius or a team of full-time employees for weeks or months on end trying to figure out the best outcomes. 

To manage the sourcing of complex categories and create business value, you absolutely must use a solution that takes full advantage of the power of optimization complemented with artificial intelligence and game theory.  

To be “complex” in the sense of the word here, a sourcing category needs to meet some combination of the following criteria:

Tim Johnson, Sales Director, JAGGAER

Why Procurement Should Adopt Design Thinking Principles

design thinking for procurement

Empathy is the way to build trust. And the strongest, most productive relationships are built on trust. It’s certainly that way in our personal lives. So it stands to reason that it’s the same with professional relationships. Yet, too often, empathy is left out of the equation when identifying and implementing solutions in the business world in general and in procurement specifically.

That’s not good because, as we all know, strong stakeholder and supplier relationships are the bedrock of a successful Procurement Ecosystem. That’s why the more I’ve learned about the concept of Design Thinking the more I am convinced it can be a game-changer for procurement.

Design Thinking Isn’t a Strategy, It’s a Mindset

What is Design Thinking? Well, it’s not a new concept. It’s been around since at least the 18th century. But its wisdom is just now being embraced by procurement teams, so it feels new.

Basically, Design Thinking involves a different mindset for how to define and solve problems and it begins with empathy for the end-user. The process starts with really listening to and understanding the biggest challenges and pain points for your stakeholders. The idea of putting yourself in their shoes, so you can be sure you are addressing their true needs and not what you think they need.

Design Thinking is a highly creative and iterative process that encourages a lot of experimenting and prototyping. The goal is to fail fast to learn even faster. When you put together a prototype and test it out, your end-users provide feedback for what works and what doesn’t in an iterative feedback loop. The end result, in theory, yields greater stakeholder alignment, better adoption rates, and demonstrates procurement’s strategic value to the business.

Greg Anderson, SVP, Sales North America, WNS Denali

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