Tools

Turning supplier information into procurement insight

 

RudiKruger_2017.jpgDecisions and consequences go hand-in-hand. This is why having adequate, relevant information at your fingertips is a critical aspect of any decision-making process - more so when these decisions affect the operation of business and company reputation.

In procurement, the optimal goal is to manage risks and costs within a company, making it an imperative department of business. Businesses spend a significant amount of time vetting potential suppliers before embarking on a partnership, and pertinent data provides them with the right tools to make informed decisions with information that is easily interpreted by management.

However, the vetting system should not end when an agreement is reached between a business and its supplier. Intensive research and vetting on future and current suppliers should be a continual safety requirement to ensure all procurement legislation is adhered to, says Rudi Kruger, General Manager of Risk Solutions at LexisNexis Data Services, in this month’s SmartProcurement.

Do SA business travellers toe the travel-policy line?

 

TravelPolicy.jpgTraveller non-compliance is an increasing area of concern among travel buyers and managers internationally, with great efforts made to persuade travellers of the benefits of compliance that extend beyond “because the company said so”.

A recent study conducted by FCM Travel Solutions and the African Business Travel Association (ABTA) revealed that the level of non-compliance among South African travellers is limited, however. At least 42% said that their travellers rarely or never booked out of policy, with a further 39% indicating that it didn’t happen often.

Is your travel technology a strategic procurement partner?

 

EuanMcNeil_HS.jpgWe’re in the throes of the 4th industrial revolution, where technology has changed the way we live and do business. Research shows that by 2020, half of the world’s business travellers will be millennials. With this in mind, it’s not surprising that the role of travel management companies has evolved way beyond making travel bookings.

Offering an online booking tool is no longer sufficient. To remain competitive, travel management companies need to draw on the latest technologies to create integrated travel ecosystems through which they can help their clients achieve specific business objectives.

Process-driven travel management has evolved into a strategic procurement function, requiring professional skills in benchmarking suppliers, issuing RFPs, negotiating contracts and collecting data for KPIs, says Euan McNeil, General Manager of FCM Travel Solutions SA, in this month's SmartProcurement.

Procurement is about to get smarter, faster and more efficient

 

Cognitive_procurement.jpgA ‘cognitive procurement’ solution is set to redefine the source-to-settle process.

The solution delivers intelligence from procurement data - together with predictive insights from unstructured information - to help make decisions in supplier management, contracts and sourcing activities.

What is procurement's future in the 4th Industrial Revolution?

 

Mluleki Ntlemeza.jpgThe fourth Industrial Revolution, characterised by a fusion of technologies that is blurring the Iines between the physical, digital and biological spheres, builds on the digital revolution (known as the Third Industrial Revolution) that has been occurring since the 1950’s, said the World Economic Forum.

'4IR' has seen the emergence of technologies in procurement, which are set to disrupt established methods. Examples are cognitive procurement and Blockchain.

Mluleki Ntlemeza (MCIPS), e-Procurement specialist at PetroSA, unpacks the impact of the fourth Industrial Revolution on the future of procurement in this month’s SmartProcurement.

SAP functionality can relieve the pinch of your procurement group's rationalisation

 

StevenFreemantle2.JPGReducing costs is a common survival strategy for organisations to employ. But, as the economic situation deteriorates, what started as a doing away with coffee, printing paper or non-essential spares becomes organisational restructuring, which may translate into job cuts. Purchasing departments have not been spared the distress of this kind of cost management, yet are still required to maintain (strategically) the service levels needed to keep customers satisfied.

Having seen many forms of cost reduction over the years (as an advisor in SAP supply chain optimisation), Steven Freemantle notes that staff reductions are seen as an accepted, albeit hugely disruptive, strategy to weather the storms of uncertain economic times, and like many strategies, there is often a disconnect between strategic intent and the day-to-day tactical activities.

“Staff are often thrust into new or different supply chain roles where they quickly become overloaded, however, if you run SAP this kind of painful organisational change can be soothed in many ways – there are SAP tools to effectively do 2, 3 or 4 people’s jobs,” says Freemantle, from SweetThorn Thought Leadership, in this month’s SmartProcurement.

Forget cost management - think 'value management'

 

value_management.jpgIn tough economic times, management may take a ruthless approach to various areas of the business where they perceive costs as being too high. For example, they immediately cut the marketing budget – when in fact marketing may be more critical than ever before. Or they trim down expenditure on IT systems, when investing in more streamlined IT processes can quickly turn into a cost saving.

Typically, costs within a company are being divided into pure operational costs - but these, in themselves, have massive indirect costs (head office expenses, FICA [for banks], IT, etc.). But in taking this approach, businesses usually have little to no idea of what the true cost to provide their service/product is.

Your SAP user community might be lying to you, but only because you let them

 

StevenFreemantle2.JPGIt is not unusual to find the procurement departments inside SAP-driven companies at loggerheads with their internal customers. In extreme cases sales, production planning, maintenance and procurement staff are on the verge of conflict – the common enemy being procurement. The typical symptom is accusations of dismal service countered by allegations of poor or no planning and utterly unrealistic expectations. This blame shifting descends into turf defending, silo mentality and, ultimately, supply chain role players becoming less and less liberal with the truth, says Steven Freemantle, of SweetThorn Thought Leadership, in this month’s SmartProcurement.

Case study: e-procurement and procure-to-pay effectiveness at Mondi

 

eprocurement.jpgA recent study conducted across international divisions of Mondi Ltd found that the South African-listed pulp and paper giant does not fully utilise, compared with best practice, enterprise resource planning (ERP) solutions and electronic procurement (e-procurement). In fact, Mondi South African Division meets only 11 out of the 28 recommended best practice requirements (41%) in the procure-to-pay (P2P) process.


Based on the study, it was recommended that Mondi standardises the utilisation of ERP and e-procurement solutions as far as possible throughout all divisions at a global level, which encompasses its operations in 42 countries and 33 000 employees.

The Kraljic Model can identify expenditure fit for P-cards

 

KraljicModel.pngAd hoc expenditure is a big headache for any organisation and procurement division: these low-value, high-volume purchases can erode budgets if processed through traditional P2P. While the solution is to introduce a purchasing card (P-card) programme, how does one determine which expenditure to put on a P-card?


A simple and effective way of segmenting your expenditure lies in the Kraljic Model, Tshipi Alexander, Head of Issuing Sales and Service at Nedbank Corporate Card, tells SmartProcurement.

Technology's role in improving the supply chain

 

Tech.jpgTechnology drives innovation and can mitigate risk in the supply chain. In recent years the integration and globalisation of supply chains has improved efficiency, but has driven complexity and vulnerability to the point of disruption. Advances in SCM technology offer a solution, Tech-Pro Personnel tells SmartProcurement.

 

Government could police spending cuts with a P-card system

 

Gordhan.jpgScepticism around government’s severe cuts to perks and expenditure, and whether these will really work, has been further fuelled by recent instances where members of public office have not adhered to the Finance Minister's spirit of cost-cutting. With the public’s patience wearing thin, government should consider a procurement card programme to curb expenditure, and reduce fraud and a waste of funds, writes Anita Carolus, Nedbank Corporate Card National Sales Manager, in this month’s SmartProcurement.

Driving visibility within African supply chains

 

SupplyChainVisibility.jpgAs supply chain management becomes increasingly central to business strategy, so the need for visibility within the supply chain becomes paramount. Greater end-to-end visibility improves revenue and reduces costs, while allowing for better management of disruption, complexity, opposition and growing customer expectation, Tech-Pro tells SmartProcurement.

Reducing transaction costs - the end of the firm?

 

RonaldCoase.jpgThe man who introduced the concept of transaction costs recently passed away at the age of 102. Interestingly, his 70-year-old theory explains organisations’ vertical integration in the first half of the 20th century and their contradictory aggressive outsourcing more recently. But how is the lower transaction cost offered by the Internet revising the theory? asks Ariba’s James Marland, Vice President of Network Strategy, in this month's SmartProcurement.

 

4 major supply chain trends in 2014

 

Trends2014.jpgIn recent years, the on-going quest for efficiency and flexibility and the impact of emerging technologies, innovation and ever-changing customer demand, has seen the South African supply chain mature from a corporate function into an enabler of growth and a strategic weapon, providing value for customers’¹, Tech-Pro Personnel tells SmartProcurement.

Millennials' tech expectations empower the other 6 billion (Part 2)

 

CustomerServiceGenerationY.jpgMillennials in the developed world are driving the adoption of technologies that facilitate commerce in the supply chains of the developing world.


As developed nations mobilise their workforce and embrace new models of business, such as The Networked Economy, developing nations are benefiting from the wave of simple, streamlined and mobile solutions, for which they can thank the expectations that Millennials have of technology, says Richard Downs, Director, Solutions Marketing – EMEA, Ariba, an SAP Company, in this month’s SmartProcurement.


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