Sourcing Strategy

How can procurement help drive organisation strategies in the face of turbulence and vulnerability?

Mediacy_.jpgCountless studies have established that the C-suite and boards of directors want their supply chains to become fully-fledged business functions and with the ability to influence organisational objectives or in the case of private sector, profitability. We have been here before, but what has been tangible proof of "from backroom to boardroom, procurement goes strategic"? How do you measure the true value of procurement's influence on organisation strategy? The answer is a function of the level of influence supply chain teams have on overall organisation strategy, says Medacy Mudekwa, Head of Content for Smart Procurement World.

Smart Procurement Review will soon hit the shelves. To get insights into procurement developments over the last 12 months, email us for your copy.

Love procurement - because it can impact society and the environment

Join us at Smart Procurement World 2019, where one of our conference themes will be "Walk the talk: High-impact procurement"

RobertFreeman_100.jpgProcurement work is much more than just securing the right products, in the right quantity and quality at the right place... Let's think wider, more holistically, writes Robert Freeman, a procurement and supply chain expert at Future Procurement, a procurement coaching and consultancy organisation.

Getting and keeping supply chain's seat at the table

LauraFaulkner_100.jpgIf supply chain professionals can secure a seat at the table, it becomes easier to share insights, challenge processes, support the business and be part of strategy creation - ultimately it becomes easier to deliver value.

"Supply chain functions act as an extension of the organisation as a whole", says Laura Faulkner, CPO and Director: Supply Chain Management of financial institution Nationwide Building Society.

Procurement's role in making progress on society's biggest problems

StephenWills_100.jpgMaking progress on society's biggest problems requires governments to make better use of data, involve citizens and collaborate with other sectors.

Procurement is constantly under threat. We always fight for recognition and access to full business spend. And, at the very time when we achieve acknowledgement for our contribution and procurement is widely understood, our function becomes a target.

For decades we have provided supply chain transformation projects, led group-wide savings programmes as well as developed risk and budget control policies and governance.

Yet, unlike other shared-service functions who are accepted as core business functions, we are tolerated as long as we deliver new benefits, yet challenged on our business results and KPIs. Our budgets become leaner with never-enough resources to achieve our goals. Once our skills are understood by the business, it wants to commoditise and outsource them to a systems-led provider or an inexperienced team of 'worker bees'.

Therefore, with this background of change and uncertainty, it is good to reflect upon and be upbeat about where strategic procurement leaders can contribute to society and to business, writes Stephen Wills (FCIPS, MBA), international senior procurement and supply chain expert, and former CPO in public and private business sectors (UK), in this month's SmartProcurement.

Show your worth: demonstrating procurement ROI

MichaelMitchell_100.jpgBring sustainable value to the bottom line

Increasingly, procurement is being looked to for the added value it can bring to the organisational table. Furthermore, expectations are on the rise, with big data and advanced analytics driving decision making to new levels by enabling teams to generate new insights and achieve unprecedented proactive capabilities.

Demonstrating procurement's value can include many components depending on the priorities of any particular company. But, with increased reliance on cloud platform P2P solutions, showing procurement's return on investment (ROI) is a great place to start, says Michael Mitchell, Senior Content Manager at Determine, a source-to-pay enterprise contract lifecycle management solutions provider.

Municipal materials management may require a counter-intuitive purchasing approach

StephenBauld_100.jpgEnsuring that the right quality of an item is ordered and delivered may seem like a fairly obvious responsibility. However, doing so in practice requires a fairly sophisticated understanding of market conditions and user requirements, which, like many organisations, municipal departments do not possess.

"There is a higher probability of generating measurable savings if municipal purchasing departments play a pro-active role to assist client departments to identify needs before they arise", says government procurement expert Stephen Bauld, in this month's SmartProcurement. Bauld argues that successful municipal materials management may require a counter-intuitive approach towards purchasing.

Good governance + accountability = long-term socio-economic development

DouglasBoateng.jpgLocal government procurement practitioners need to recognise the inextricable link between good governance, accountability and long-term socio-economic development, says Prof. Douglas Boateng.

Procurement in 7 memes

DistractedBoyfriend_small.jpgThey say a picture tells a thousand words. How about a procurement meme?

Okay, millennials. Strap yourselves in, because Hugo Britt, Content Manager at Procurious, is going to attempt to meme. Is meme even a verb? Perhaps not, but that isn't going to stop him.

For older readers who don't really know (or care) what memes are, don't worry - Britt's got you covered. Whether it's Bad Luck Brian, Kermit Sipping Tea, or King Leonidas screaming "SPARTA", Britt will attempt to add a bit of context around the meme before applying a Procurement gripe to each.

Join Britt at Smart Procurement World Gauteng in September, where he'll present procurement's "guide to blockchain technology and how it will change our world". He'll look at early applications of blockchain in supply chain, specifically automotive, freight and logistics.

8 ways to create procurement value

SergeyDovgalenko.jpgProcurement professionals who traditionally measure their effectiveness by means of savings will sooner or later face the following problems: a depletion of supplier resources and a loss in supplier motivation in terms of further co-operation. Suppliers cannot always be the sole source of benefits, patching holes in your company's balance sheet with their funding, says Sergey Dovgalenko (FCIPS), Head of Procurement, Etihad Airways.

Procurement and the 4th Industrial Revolution

DanBartel.jpgHow can the procurement function adapt to the new reality of Industry 4.0? What can procurement leaders do to lead the change?

To explore possible answers to these questions, Dan Bartel, Group SVP, Head of Procurement & Logistics/Chief Procurement Officer, ABB, unpacks Industry 4.0 in the context of Klaus Schwab's 2016 book, The Fourth Industrial Revolution, in which Schwab (World Economic Forum Founder and Executive Chairman) identifies four significant effects of Industry 4.0 on businesses across industries.

Procurement and our KPIs

ShaunStoch.jpgMost of us working in procurement for a large organisation get new and updated Key Performance Indicators (KPIs) every year. Shaun Stoch, Procurement Management at Maersk Line, often finds himself looking at his KPIs and asking the question: "where does this fit into the value chain and do my KPIs actually improve our product offering?

Digging a little deeper into the literature, Stoch found that the consensus seems to be that many organisations are still working with old procurement models and the real value of procurement is not visible to many executives - there remains a disconnect between procurement KPIs and organisational strategy.

However, he told SmartProcurement that this old mindset is slowly changing.

What is the true cost of unethical conduct?

XavierGreyling.jpg'Procurement irregularities' has taken 3rd place on Corruption Watch SA's Corruption Report 2017 (CRW2017). Coming in at 12% of the reported types of corruption, procurement irregularities trails bribery as the most common form of reported corruption (27% of cases).

However, CRW2017 does not define 'procurement irregularities', which caused Xavier Greyling (MCIPS) to question if procurement irregularities do in fact account for only 12% of the reported cases, and, faced with the possibility of a far higher figure - what role does procurement play in what is lost to corruption every day?

Contracts: Paying for what works

SusanDeWitt.jpgAre performance clauses and outcomes-based contracts the answer?

Dr Susan de Witt from the Graduate School of Business at the University of Cape Town unpacks contract performance measurement in this month's SmartProcurement.

New ways needed to procure construction projects in 2018

Stephen_Bauld.jpgManagement methodology in some municipalities is changing for the better, says Stephen Bauld. During 2017, Bauld spent a great deal of my time working on behalf of contractors, raising issues related to construction projects with municipal staff at every level. He has seen a commitment by senior management to make systems better and to listen to industry concerns to make positive changes to the process.

Procurement with purpose: beyond the bottom-line

Patrick_McCarthy.jpgHow can you embrace the notion of procurement with purpose authentically and in ways that are consistent with your core beliefs and ideals? Patrick McCarthy, SVP and GM, SAP Ariba North America, guides the way...

Procurement agility in the age of digitalisation

GilesBreault.jpgHow can your procurement team embrace the age of digitalisation and develop an effective roadmap that ultimately puts you in the driver's seat?The digital enablement field is wide open, with no single right answer on how to proceed.

However, there are ways that can help organisations to plot a way forward. CPOs must define a roadmap for change and align it with enterprise-level digital transformation initiatives, says Giles Breault, Supply Chain, Sourcing and Procurement Executive at The Beyond Group AG.


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