SIG University Certified Sourcing Professional (CSP) program graduate Thomas Moran shares the different types of KPIs that are vital to an organization and the importance of performance management.
A KPI is a Key performance indicator; this is a measurable rate or value that demonstrates how effectively and efficiently a team or objectives is performing. Many companies use KPIs to evaluate success in reaching goals or targets. They should have a clear objective and align with your business goals.
Why are they important?
KPIs are necessary to determine if a business is meeting its goals, give accountability, and leverage the health of outsourced relationships based on performance metrics. If we look at BPO ( Business process outsourcing ), KPIs are critical to determining the work's weekly, monthly, and quarterly health of the outsourced work. It creates accountability to ensure. Vendors are meeting and maintaining these values and ensuring the work they are supplying is consistently kept to a high standard.
Setting and Measuring KPI
KPI should be directly related to your business goals. These should be quantifiable measurements to gauge the health of your work. For instance, in some BPO work, your KPI could be based on customer satisfaction rates, turnaround time, quality of action taken, or how effectively and efficiently the team is performing productively.
Type of KPI -
Thomas Moran, Global Outsourcing Senior Programmer Manager, Pinterest
SIG University Certified Sourcing Professional (CSP) program graduate Yukta Ramanan shares her unique perspective of ethical business and sourcing practices from the next generation of sourcing professionals.
My name is Yukta Ramanan, and I'm 17 years old. Now you may be asking yourself: why is a teenager training to receive a Certified Sourcing Professional (CSP) credential? The question is entirely valid. Unlike most people taking this course, I have little experience working professionally within the field of sourcing. What I possess, however, is a uniquely Gen Z perspective on the future of sourcing, and my motive for taking the CSP course was to learn how to bring my vision to fruition.
The Sourcing Industry Group's CSP training taught me a great deal about business finance and strategic value chain analysis. A lesson I found particularly eye-opening was centered on ethics within supply chains. A business must define company-specific ethical standards to decide on a moral issue. Determining what is ethical, which varies broadly, usually follows five approaches.
Yukta Ramanan, Executive Director, Youth for Ethical Sourcing
SIG University Certified Sourcing Professional (CSP) program graduate Sergio Mielnik shares an in-depth understanding of how supplier relationships should be managed and how improving supplier relations at different levels will create successful sourcing engagements.
Throughout the certification, a constant emphasis on supplier relationships and the guidance provided to use these relationships as drivers to successful sourcing engagements. Suppliers are critical drivers of your pricing, delivery, strategy, and forecast. I have engaged suppliers from sole-source, directed, competitive, non-competitive, and management sources. Each situation has been unique, but I have treated all suppliers with the same level of communication and collaboration.
As supply chains get tighter and more competitive, it is essential to keep those communication channels to create a personal approach rather than a solely monetary exchange approach. This does not mean you hand out the keys to your supplier, but if this could happen, you can trust the relationship developed to obtain solutions and drive success.
Managing suppliers at different levels, whether critical or non-critical, is another topic that I found interesting. The relationship between a “ma and pa” shop versus a top-tier conglomerate is not the same. Still, you must strive to find that personal connection with different types of companies, provide fairness in your approach, and understand each supplier’s competitive advantages. I have often found myself waiting in line with top suppliers, which affects our delivery and production schedules.
Sergio Mielnik, Lead Business Risk and Controls Advisor, USAA
SIG University Certified Sourcing Professional (CSP) program graduate Mahesh Khamkar discusses the concepts of business model mapping and cost modeling and how to apply them to your business.
An excellent program has come to an end, but the concepts learned will be with us forever. All modules are equally important as part of a successful sourcing professional learning journey; however few topics I found interesting which relate more to my current responsibilities & domain are: Business Model Mapping, Cost Modelling & TCO.
Business Model Mapping: In the current role wherein I have been dealing with more than 30-40 suppliers, we never segregated them as Basic, Approved, Preferred, etc. With the deep insight provided by the SIG CSP program, we have started mapping suppliers on Sourcing Continuum based on Transactional-Relational-Investment business models.
This has further enabled us to know that few suppliers who were earlier in either Transactional or Approved Category have the potential to convert them further on Sourcing Continuum to preferred and Output/Outcome-based economic model. An example: A supplier we used to consider for regular buying of a particular cabinet is now being developed for more complex designs. The relationship model with this supplier is now more strategic as we are planning legacy products & new products jointly in a better manner. As the outcome from the supplier is more than the expectations, we are raising the bar by discussing more strategic developments with the supplier.
Mahesh Khamkar, Deputy General Manager of Procurement, Reliance Projects & Property Management Services Ltd
SIG University Certified Sourcing Professional (CSP) program graduate Nancy Wieskus shares the "Better Method" for procurement teams to implement into their procurement system.
The hybrid procurement method combines a central procurement base with subject matter experts (SMEs) already in each department to balance stakeholders' functionalities and strategic sourcing, which gives the business the best of both worlds.
Centralized purchasing or Procurement is a system in which one department manages the purchasing of goods and services for the entire organization. The purchasing department is usually located in the organization's headquarters, where it operates the purchasing for all the branches in the firm. Advantages of central purchasing include reducing redundant work, lowering costs associated with training and supporting additional staff, and better controls. Disadvantages may be that the category manager may not be a subject matter expert in the particular category. It may take longer to complete a contract as Procurement takes a strategic approach. Also, stakeholders may be resentful in introducing other vendors into the mix.
Decentralized Procurement, on the other hand, allows individual stakeholders to make purchases for their departments. This, too, can have its advantages. Decentralization brings the decision-making process closer to the scene of action. This leads to quicker decision-making at the lower level since decisions do not have to be referred up through the hierarchy. Disadvantages are lower cost savings, competitive edge, reduced workload, and strategic advantage.
Nancy Wieskus, Lead Category Manager, Valley. Bank
SIG University Certified Sourcing Professional (CSP) program graduate Patrick Fifer shares how important it is to manage your direct stakeholder relationships in the sourcing world.
Throughout the Certified Sourcing Professional program, stakeholder management was a critical aspect interwoven throughout the lessons. It is the area that I would like to focus on for my blog submission. As a sourcing professional, it is of the utmost importance to manage each of your stakeholder relationships equally to ensure that your categories' sourcing process is maintained appropriately. A consistent approach to managing each of your stakeholder relationships will help to avoid the exclusion of the sourcing professional due to the stakeholder:
Patrick Fifer, Category Procurement Manager, CoStar Group, Inc.
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 Sourcing Professional (CSP) program graduate Anirudh Sundareshwar outlines howmanaging stakeholders is well-served via effective communication.
A generic definition of stakeholder management is “Stakeholder management involves taking into consideration the different interests and values stakeholders have and addressing them during the duration of the project to ensure that all stakeholders are happy at the end.” It is important to understand that this may not always be true, especially in projects where multiple stakeholders and personal stakes are involved.
However, it is essential to ensure that most stakeholders are happy with the project's end result or initiative you are working on. That is not accomplished only by the end result but builds up along the project's lifespan.
As we have learned, one of the most critical tenets of stakeholder management is communication. It is vital to know what to communicate to whom, when to communicate and how to communicate, especially to senior stakeholders. This is an art and not easily achievable. Even more so in the current scenario where most people work remotely and do not have the advantage of picking up cues (verbal/non-verbal) as you would have in the pre-COVID era. Stakeholder management in our world involves both internal and external stakeholders, of course.
Anirudh Sundareshwar, Director & Head of Sourcing, BNY Mellon
SIG University Certified Sourcing Professional (CSP) program graduate Madison Mobley discusses how toarticulate value by utilizing hard savings, soft savings, and cost avoidance.
My first corporate job out of college was with EMC Corporation, now Dell EMC, notorious for its Sales Associate Bootcamp.
Picture seven weeks in a basement without food and water (tee hee, dead serious), and an exam every couple of days, 90% or higher to pass… Delicious.
The result? I learned how to talk technology very well – the bits, the bytes, the speeds, the feeds. And, at a time when the information age called for CIOs to reimagine how their company’s data was to be stored and protected, nothing was sexier than a storage array with fibre channel connectivity and two-factor authentication.
What’s more, I learned who best to engage at the individual contributor, mid-level management, and executive leadership levels. It was the same person(s) at every organization I prospected into 99.999% of the time for what I was selling.
Long preface short, knowing your product, knowing your ICP (ideal customer persona) and articulating that knowledge in your prospect’s “love language” made for a successful salesperson back then.
Fast forward to March 2020.
The day I joined Fairmarkit, the intelligent sourcing platform that revolutionized how all organizations buy the stuff they need (it doesn’t matter what the stuff is), I felt confident stepping into a sales role.
True, I had never sold directly to procurement people, but how different could it be?
The answer? Way different.
Madison L. Mobley, Senior Account Executive, Fairmarkit
SIG University Certified Sourcing Professional (CSP) programstudent Jessica Maki works at Driven Brands. She shares what she’s learned about contract negotiation and how she is implementing newly learned best practices and techniques to score bigger wins and drive more savings for her company.
In the CSP program, students focuson the hard and soft skills of sourcing, including strategic sourcing and outsourcing methodologies, as well as best practices in negotiations.
Negotiation planning plays a big part in the procurement industry. Procurement is always looking for the best price, best supplier performance and cost savings for the organization. In SIG University’s Certified Sourcing Professional program, I learned several key factors when it comes to negotiating with suppliers including preparation, best practices, and what to do versus what not to do. Throughout my experience as a procurement specialist, I’ve learned to apply these important techniques during the negotiation process, and it has helped me become a more confident negotiator.
 (1)_5.png?AV4_zqRw14Hk8Nk0TmOTL4M29EeBWAG2= "The Ethics of Business: a Youth Perspective")
 (1)_0.png?4gYmcVUjbxcTBgkkPzq3ck_GDcHJr4FH= "Improving Supplier Relations")
_1.png?Ppd2Q_iDsAIdI0X5BJvHW1er1IkxvZkt= "Business Model Mapping, Cost Modeling & TCO")
 (1)_2.png?rP8Z1AlfjxSePvI1JiVCySV0mmw8_vYI= "The Better Method")
 (1)_1.png?fyDcmM5DuQCcNluUpg9htn2TGsnJx0Y9= "The Importance of Stakeholder Relationship Management")
_0.png?2jE8gUasnPxYLLYdjJDnapme3nrYvEs6= "Utilizing Team Engagement in Procurement")
 People who want Their Products Bought (2) (1).png "An Open Letter to Procurement Sales People who want Their Products Bought")
KPI & Performance Management
SIG University Certified Sourcing Professional (CSP) program graduate Thomas Moran shares the different types of KPIs that are vital to an organization and the importance of performance management.
A KPI is a Key performance indicator; this is a measurable rate or value that demonstrates how effectively and efficiently a team or objectives is performing. Many companies use KPIs to evaluate success in reaching goals or targets. They should have a clear objective and align with your business goals.
Why are they important?
KPIs are necessary to determine if a business is meeting its goals, give accountability, and leverage the health of outsourced relationships based on performance metrics. If we look at BPO ( Business process outsourcing ), KPIs are critical to determining the work's weekly, monthly, and quarterly health of the outsourced work. It creates accountability to ensure. Vendors are meeting and maintaining these values and ensuring the work they are supplying is consistently kept to a high standard.
Setting and Measuring KPI
KPI should be directly related to your business goals. These should be quantifiable measurements to gauge the health of your work. For instance, in some BPO work, your KPI could be based on customer satisfaction rates, turnaround time, quality of action taken, or how effectively and efficiently the team is performing productively.
Type of KPI -