SIG University Certified Sourcing Professional (CSP) program graduate Jigar Mistry shares the potential benefits and opportunities that can arise from outsourcing.
At the current time, it is challenging to find an organization that performs all its core and non-core business in-house. Outsourcing business activities became standard across industries irrespective of their size or work area.
There is a high chance that was answering services of any banking, insurance, technology, and an external organization handles many more. Most large-scale construction of tunnels, bridges, or roads for public or private players is dealt with by contractors who are masters of their field. Even research and development activities of automobile companies or even defense sectors have adopted outsourcing for their critical tasks.
We will look into the nature of outsourcing projects in terms of relations management, the advantages/ disadvantages of outsourcing, and best practices for collaboration.
Advantages
Jigar Mistry, Senior Supply Chain Specialist, CDK Global
SIG University Certified Sourcing Professional (CSP) program graduate Andrew Beck shares the difficulties associated with change management in sourcing and how it can help improve inefficiencies.
Andrew Beck, Capital Equipment & Construction Buyer, American Honda Motor Co., Inc
SIG University Certified Sourcing Professional (CSP) program graduate Devendra Pathakshares how the focus on Category Management can help your organization grow with his very own with a step by step model.
Category management is one of the areas in which I should focus on my organization.
After the category management session, I understood the importance of category management. A category plan has two main aspects, category analysis, and category planning. However, before starting to work on any category plan, I would like to understand the category maturity. It will give me a real picture of the category and areas where we should be more focused. Once I study the category maturity in terms of spending and contracts, I will then work on the category plan.
Category analysis where I will study the following,
Global industry trends,
Spend analysis
Demand & supply dynamics
Porter’s five forces
Global Industry Trend- This is all about the latest trend in the category across all regions. What is the new commodity which has the highest demand globally and where we have less demand due to technological change or updates?
Spend Analysis- I can say that spend analysis is the heart of category management. It has a major role in developing a sourcing strategy. I will analyze category spending to understand the top 10 sub-categories then the top 10 suppliers and top 10 commodities where we have the highest spending in the category.
Devendra Pathak, Senior Procurement Analyst, CDK Global LLC
SIG University Certified Sourcing Professional (CSP) program graduate Larry Trawick shares how excellent communication is vital in ensuring success and how important it is to incorporate effective change into your sourcing practices.
Larry Trawick, Senior Sourcing Analyst, Polaris Industries
SIG University Certified Supplier Management Professional (CSMP) program graduate Damilare Adeoye discusses why having a strong relationship with suppliers makes for more compatible businesses.
Successful supplier identification, qualification, and onboarding require a stringent supplier relationship check. This is important because it drives a long-term relationship with the supplier and the client, not based on cost, price reduction, or specification alignment.
This lesson, to me, is the art of any successful supplier relationship.
However, many procurement professionals and their organizations need to gain these skills. No wonder the relationship with the supplier is shabby, and most times, a one-way approach where the client is always looking for ways to save money and still get quality materials, and the supplier is always looking for ways to increase the price. "Any relationship that is not built on compatibility is a relationship that is heading for a crash."
In this essay, I introduce you to "what" a supplier relationship fit is and "how" to successfully develop a supplier relationship compatibility/fit, implementation, and management.
Definition:
Supplier: An organization that provides raw materials, products, or services.
Compatibility: the state in which two things can exist or occur together without problems or conflict.
Supplier Compatibility is when an organization that provides raw materials, products, or services shares similar strategic approaches, goals, and objectives.
SIG University Certified Sourcing Professional (CSP) program graduate Shawnie Albritton shares how category management can help with cross-team engagement and its usefulness in procurement.
Shawnie Albritton, Sr. Procurement Operations Analyst, Raymond James
SIG University Certified Supplier Management Professional (CSMP) program graduate Indre Ciuberke breaks down the importance of the Supplier Relationship Management (SRM) Framework and the four quadrants of SRM communication that adjust the ways of working with suppliers.
When you think about the Supplier Relationship Management (SRM) Framework, it’s not just walking and talking with your Organization partners and having a relationship with them. From my perspective, SRM is based on relationships, however, stressing the communication and information sharing process in the particular relationship. Usually, SRM has corporate attributes such as ensuring the governance, agenda tracking and managing risks associated with the services or products that the supplier provides to the organization.
Every team is focused on bringing value to the organization. SRM can contribute to this is to push the streamlined service delivery by becoming a core internal team in the organization's structure for outsourced service management.
Supplier Relationship Management Team Framework
I have tried to describe the basic SRM as an internal core team framework in the picture above. The idea is based on communication and information flows:
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.
In early December 2020, Google published its trends for 2020, listing the top searched terms, people, news stories and more. It is no great surprise that "Coronavirus" was the top searched term and news story. Nor that Tom Hanks, Kobe Bryant or Kamala Harris were high on the list. What I found remarkable is that these trends were not reflected in the top searched terms for SIG's website in 2020. In fact, it was business as usual on our website. Sure "COVID" and "resiliency" and "remote work policies" made the list. Website traffic and searches increased in volume, but our visitors were searching for the same topics and downloading some of our best case studies for help.
Here's just a short snapshot of some of the trending searches in 2020:
Category Management
Most sourcing professionals know what category management is and a critical mass of our members practice category management at varying levels of maturity. This SIG blog summarizes our resources in one location and is one of our most visited pages. Members frequently download our Template for Building a Business Case for Category Management.
Mary Zampino, Vice President – Content, Research & Analytics
Each year, organizations spend over $20 trillion globally on all kinds of services, according to some estimates. Services in the U.S. make up, on average, nearly 60% of organizations’ total non-payroll external spend (and that can be significantly higher in some industry verticals). The effective management of services spend has been a perennial topic of discussion (and limited action) over many years. And technology used to address complex services in an organization is not well understood.
Spend Matters and Sourcing Industry Group have partnered to field a survey of procurement professionals (CPOs, procurement directors, category managers, etc.) that is described briefly below.
The purpose of the survey is to better understand how and to what extent procurement is using enterprise procurement technology and other solutions to process and manage an organization’s service categories and with what level of satisfaction.
For this survey, the term "services" encompasses a broad range of spend categories, like consulting, facilities management, legal, temporary staffing, marketing and so on.
Despite the size of this mega-spend category, procurement leaders we talk with have agreed that most categories of services are not, to put it kindly, optimally managed and there are few best practices.
There also seems to be agreement that purpose-built technology for specifically managing different services categories, strategically and tactically, is lacking.
Andrew Karpie, Research Director for Services and Labor Procurement, Spend Matters
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 (1).png "Making Supplier Relationship Management Work")
 (1).png "Does your business need to understand category management principles?")
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.png "Complex Services Procurement and Technology")
Outsourcing: Challenges, Opportunities and Best Practices
SIG University Certified Sourcing Professional (CSP) program graduate Jigar Mistry shares the potential benefits and opportunities that can arise from outsourcing.
At the current time, it is challenging to find an organization that performs all its core and non-core business in-house. Outsourcing business activities became standard across industries irrespective of their size or work area.
There is a high chance that was answering services of any banking, insurance, technology, and an external organization handles many more. Most large-scale construction of tunnels, bridges, or roads for public or private players is dealt with by contractors who are masters of their field. Even research and development activities of automobile companies or even defense sectors have adopted outsourcing for their critical tasks.
We will look into the nature of outsourcing projects in terms of relations management, the advantages/ disadvantages of outsourcing, and best practices for collaboration.
Advantages