Process and Best Practice Content

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With High Intensity Hurricanes the New Normal, Procurement Must Plan Ahead or Suffer the Consequences

As the 2018 Atlantic hurricane season draws to a close at the end of November, it’s a good time to reflect on how one of the most disruptive periods of the year is affecting supply chain risk planning. If there were one lesson for procurement to learn from the past season, it’d be this: Hurricanes are becoming more powerful and lasting longer. The last several years of intense storms (think Harvey, Irma, Maria, Florence and Michael) are not anomalies but what appears to be the new normal. Businesses must therefore take stock of the new standards for natural disasters and prepare accordingly — or risk being caught off-guard.

ERP Systems Under Pressure as Internet of Things (IoT) Piles on the Data, Survey Finds

As the industrial internet of things (IoT) integration grows more complex and the cost of broad-based IoT integration and monitoring continues to fall, businesses are becoming aware of the limitations of their enterprise software in making use of IoT data, a survey finds. IoT involves the monitoring of all aspects of manufacturing or a business by imbedding monitors in things like components, production lines or fleets of vehicles, so it’s easy to see how they would create a flood of data. IFS North America, a business software provider who commissioned the study with researcher IEN and analyzed the results, asked 200 IoT decision makers across a range of industries how well their software facilitated IoT data integration in 2017 and 2018. The results show a decline in confidence.

‘More people in the tools, lower risk, faster processing, better results’ — Roy Anderson sums up procurement’s future (Part 3)

“Use your suppliers to get the work done more efficiently, effectively and start to manage the overall supplier base like an orchestra leader,” procurement veteran Roy Anderson says, laughing at the image — but not the lesson. “That orchestra leader can’t play every instrument and certainly isn’t going to sing every song, but has to be able to have the structure and the reporting and the analytics to be able to manage it more effectively.

“That’s the future. A virtual procurement operation living on a marketplace of capabilities is the future of procurement.”

In Part 3 of Anderson’s conversation about his career and digital changes in the industry, he talks about being at Tradeshift (“where ideas win”),  how “every CPO has a bandwidth problem” and the promise of AI.

Anderson, who became Tradeshift’s CPO and digital transformation officer in September, sat down with another procurement veteran, Pierre Mitchell of Spend Matters, to share some laughs and lessons about how the industry adapted to technology over the last 40 years.

The following is the last of a three-part series of their conversation, which has been edited for clarity. Part 1 ran Monday, and Part 2 ran Wednesday.

‘I Think Demand Management Is the Bigger Play,’ Roy Anderson Touts Visibility into Spend, Risks of Not Buying In (Part 2)

“I saved you all $5 million,” procurement veteran Roy Anderson tried to tell one CFO he worked for. “To this day, he’s never totally believed that.”

In Part 2 of Anderson’s conversation about his career and digital changes in the industry, he talks about change management, demand management and how he did convince another CFO that Anderson’s team had saved him $150 million.

Anderson, now at Tradeshift, sat down with another procurement veteran, Pierre Mitchell of Spend Matters, to share some laughs and lessons about how the industry has adapted to technology over the last 40 years.

The following is the second of three-part series of their conversation, which has been edited for clarity. Part 1 ran Monday, and Part 3 will run Friday.

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Spend Analysis Requires Human Expertise for Data Optimization, Data Visualization

From recent conversations during this fall conference season, it’s clear many procurement teams are still struggling with poor-quality spend data. Combined with the challenges of data lakes, corporate changes from mergers and acquisitions, and an overall pressure to get more savings year over year, procurement leaders are finding it difficult to align their talent and technology strategies for their digital transformation efforts.

Whether it be companies in the market for spend visibility for the first time or those looking to focus on spend analysis and visibility to engage digital transformational efforts, organizations will, for now, still need to get the basics of spend analysis right with human interaction and expertise combined with innovative technologies that will evolve and improve over time.

The Tip of the Spear: How Serco Has Used Spend Data to Generate Business Value

Spend data is a gold mine of valuable information for improving the procurement process as well as driving enterprise-wide decision-making. FTSE 100 services provider Serco learned this first hand when it engaged Simfoni, a provider of spend analytics tools, to change the way it gathered, presented and analyzed its data. Using spend analytics as the tip of the spear, the Serco team developed “should cost” predictive cost models to develop better bids for potential clients — and support what every CEO wants: profitable growth. 

Spend Matters hosted a recent webinar in which experts discussed the topic. Featuring Serco Head of Procurement Andrew Spafford and Simfoni Managing Director Stefan Dent, the event centered on the role that spend data should play in an organization’s decision-making process. Spend Matters Chief Research Officer Pierre Mitchell moderated.

‘I Have Plenty of Stories’ — Roy Anderson Details Procurement’s Digital Roots and Its Future

Procurement veteran Roy Anderson understands the current digital revolution that holds so much promise, and some pain, for businesses because he’s been a leader of it for over 30 years. From Raytheon in the 1980s to building procurement software from scratch to today’s AI buzz, he has a story for every step of the way:

“Moving to a printed requisition was what [stakeholders] thought was automation.”

“Simplify the process. ... Eliminate the excess and then automate the mundane. … It’s still valid today, on how to do business.”

“As I did strategic sourcing, I found problems. I have plenty of stories around problems you find. ... Your current suppliers know bad things have occurred, but they always want to stay quiet.”

Anderson, now with Tradeshift, sat down with another procurement veteran, Pierre Mitchell of Spend Matters, to share some laughs and lessons about how the industry adapted to digital changes over the last 40 years. The following is the first of three-part series of their conversation, which has been edited for clarity. Part 2 will run Wednesday, and Part 3 on Friday.

Enabling Agile Supply Chain Management to Combat Natural Disasters: A Case Study of Biogen and Resilinc

As procurement professionals know, natural disasters are a question of not “if” but “when.” Hurricanes, earthquakes, wildfires or severe weather can quickly hobble even the best-laid supply chain plans, our sister site MetalMiner reports. Just look at the research. According to Resilinc’s Supply Chain Disruption Annual Report, disruptions roughly doubled in 2017, potentially impacting 32% of S&P 500 companies’ supply chains. The supply chain risk monitoring firm’s CEO Bindiya Vakil pointed at that data as an indication that procurement leaders can no longer stay complacent about planning for events like natural disasters.  “This should be a wake-up call for business leaders around the globe,” Vakil said in the report.

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Driving Adoption Through More Effective E-Procurement Change Management

Accenture

Change management, as a business discipline, dates back to the 1960s. Despite steady growth, dozens of “breakthrough” discoveries and countless books on the topic, the practice of change management hasn’t been very successful. According to McKinsey & Company, only about 30% of change management initiatives are successful in achieving their intended business outcomes. How should finance and procurement leaders who seek to drive adoption for e-procurement platforms regard change management? As John Hu, Shelby’s vice president of client services, is fond of saying, “change management isn't a project workstream, it’s the entire project.” There are numerous theoretical frameworks for enterprise change management. These can be helpful references for understanding the challenges and principles for managing change in today’s business environment. However, trying to apply any of these models to the practice of rolling out your procurement transformation initiative won’t get you very far. The need for a purpose-built approach: Conventional enterprise change management approaches are too generalized to address e-procurement adoption challenges. Our latest e-book, E-Procurement Change Management Strategy, offers a six-step, purpose-built framework for e-procurement change management that can be adapted to fit the needs of organizations with different requirements, cultures and business objectives.

Once You’re in the Cloud, Managing Cloud Costs Can Be a Challenge, Report Says

A couple of years ago, organizations raced to catch up and understand cloud computing and formulate strategies for adopting cloud services. Now, according to a new report, the problem isn’t so much cloud adoption, it’s managing the cloud. Organizations that made the switch are finding new problems they didn’t foresee, leading to cost overruns and exposing disconnects between levels of management. According to “The State of Cloud Readiness 2018,” a new report put out by managed services provider Softchoice, while cloud adoption has risen since 2016, organizations aren’t seeing the results they’d envisioned.

How to Hack Your ERP and Create Competition for P2P Suite Providers

Spend Matters welcomes this guest post from Doug Hudgeon, a business automation expert.

P2P software is painful to buy and painful to implement. In order to get the biggest benefit, you need to rip the purchasing spinal cord out of your company and replace it with an end-to-end P2P system. This is a big project, requires a big budget and, if you are going to deliver on the promised benefits, you must have an unwavering commitment to change. Sales cycles are long but, fortunately for P2P vendors, the margins on the deals that do get across the line can be pretty good. But the competitive landscape is about to shift.

6 Ways To Really Mess Up Your AP Automation Project

Spend Matters welcomes this guest post from Melissa Hendrick, VP of marketing at Yooz North America.

Today, automation technology is one of the inevitable trends for companies wanting to improve their efficiency and agility in a complex economic environment. The reasons are clear: cost reduction, process optimization, data security, regulatory compliance and many more.

If you are considering automating your invoice payment processing workflows in accounts payables, or are already investigating solution providers, your success will be based on following some basic guidelines and avoiding some common pitfalls.

With that in mind, here are some insights to help you identify the pitfalls on your journey to AP automation, combining practical information with a little tongue-in-cheek humor.