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Kraft Buys Into the Mirage of Vendor Rationalization
In yet another example of the "when will they ever learn" category, About.com's Martin Murray's article "Kraft To Rationalize Vendors" reported that the company "announced that it is planning to cut its supplier base in half, affecting more than 30,000 businesses, but possibly saving Kraft more than $300 million a year." Putting aside for a moment that enterprise-wide rationalization strategies rarely deliver the sustainable savings that are expected - it would be interesting to see how the $300 million per year number was actually calculated - history has shown that the "sifting" process usually results in a supply base composed of the least desirable vendors.
Spend Analysis versus Spend Intelligence: More Than a Semantical Difference
I believe the phrase "spend intelligence" to be misleading. To me, it sounds like a new take or sub-segment of business intelligence software applications which offer analytics and dashboard capabilities and sit on top of existing systems of record. The problem is that spend visibility and analytics is much more complex, requiring data cleansing, rationalization, classification and other efforts which go far beyond what is needed to gain insight into basic HR, financials, IT and other internal information, which fall cleanly in to the BI camp.
With IBX Purchasing Isn’t Just A Business, It Is A Way Of Life!
“Desire is the key to motivation, but it’s determination and commitment to an unrelenting pursuit of your goal – a commitment to excellence – that will enable you to attain the success you seek.” Mario Andretti, one of the most successful drivers in the history of auto racing

Undiscovered Diamonds for 2008: Finding the Acres of Diamonds in an Evolving Market (Certify Profile)
“For every acre of that old farm, yes, every shovelful, afterward revealed gems which since have decorated the crowns of monarchs.” From Acres of Diamonds by Russell H. Conwell

Doing What Comes Naturally Accessing Zycus Spend Management Innovation Through A Simplified and Practical User Interface Zycus Inc Profile
“Recognizing that adoption or end-user compliance is one of the main barriers to a successful program, the ability for project champions to leverage user comfort with known applications such as Excel to access certain functions within the SAP architecture could stimulate stakeholder buy-in, at least internally. By promoting the utilization of SAP through a familiar, easy-to-use interface, the overall level of possible resistance may diminish to the point of making the SAP PPS offering more viable.

Moving Procurement Practice Beyond Adjunct Complexity (COUPA Profile)
“Organizations that already have a technology driven program in place or have just recently implemented one still surprise me with their significant interest in the dramatic changes in procurement methodologies and practices. But rather than focusing learning on new and emerging technologies, today’s procurement professionals seek insights into the actual processes that drive their enterprises. The impetus behind this change is largely the result of the fallout from the consistently high level of e-procurement initiative failures. Industry studies for the period 2001-2005 indicate 75-85% of all programs fail to achieve the promised results. (Editor’s Note: the rate of failure continues today, with some industry pundits suggesting that ERP-centric programs miss the mark as much as 90-95% of the time.)
The Socially Responsible Procurement Practice: Moving Beyond Social Consciousness (enterprising non-profits Profile)
“The question this raises is quite simply what set of circumstances will elevate green procurement from a nice to do “boutique” status to a more meaningful (and essential) element of a sound purchasing strategy? At the risk of answering my own question, I do not think that green procurement in and of itself will achieve this status, nor do I believe that it is a reasonable goal.
Overcoming the challenges of an ineffective RFP process: Improved collaboration through intelligence synchronization (QStrat Profile)
I have had close to 30 reader responses to my recent posts on the utilization of the RFP or e-tendering process for the acquisition of goods and services. While there have been successful demonstrations of its utilization relative to MERX (MERX: An Evolution to a Broader Market), and of course the Commonwealth of Virginia’s eVA program (Yes Virginia! There is more to e-procurement than software), the majority of respondents do not view the current process has being effective. (Note: links to the above referenced articles are available through the Web Resources section at the conclusion of this post.)

When responding to RFI/RFQ requests what's the biggest obstruction a supply chain project manager can face?
Network Member Question When responding to RFI/RFQ requests what's the biggest obstruction a supply chain project manager can face? Thom Spencer Recruitment & Human Resources Consultant and Contractor Wakefield, UK
Finding the hidden Intellectual Property (IP) value in procurement contracts (Future Path Profile)
Looking beyond what Future Path President and CEO Greg Waite referred to as the “casual conversation” surrounding the issue of Intellectual Property (IP) rights within the majority of procurement contracts, I thought of my own work as a consultant. I am often retained by both public and private sector organizations to prepare studies or reports on a variety of topics ranging from the viability of digital signatures within the contract routing process to assessing the changing technological landscape and its impact on current as well as contemplated e-procurement strategies.

Is There a Difference Between a Material Requisition and a Purchase Requisition? (A PI Q&A)
Network Member Question Can anyone advise me of the difference between a material requisition and purchase requisition? Manal Al-Asousi Manager, Operations & Projects Development – Kazema Global Holding Co. Kuwait

Procurement considerations when dealing with a merger? (A PI Q&A)
Network Member Question Aside from the basics of spend analysis and eliminating redundancy, I’m curious to hear of other’s experiences in dealing with merger/acquisitions and how the cultural elements were addressed in terms of promoting the use of preferred vendors and the adoption of expense management policy. What are some best practices to promote optimal adoption of the governing policies and procedures in the absence of spend management technology? Paul Nilsen Purchasing Manager – Willis North America New York, NY

Development of SAAS Based Applications
Member Question: Many research firm has predicted SAAS is going to become a next level Application Development. 1.How can i convert a existing applications into SAAS based Apps. 2.What are requirements need to develop a SAAS based Applications. Question Submitted By: Rajasekar Nonburaj Business Intelligence Consultant India

Financial Supply Chains: Member Question & Survey
Network Member Question: What does the term "financial supply-chain" mean to you? Enrico Camerinelli, Finance Director Europe's consultant editor for supply-chain has developed a short online survey on this subject - should take a couple on mins for you to complete - would be grateful if you could take time out to complete - the web link to the survey is as follows: (Note: to access the survey, please contact the author) Look forward to hearing your views Question Submitted By: Steve 'Dunkerley' Project Director - Finance Director Europe (FDE) United Kingdom

What is the next Hot module coming up in SAP?
Member Question: What is the next Hot module coming up in SAP I am in the field of SAP for the past 4 years in the technical field focussed more on conversion, I want to move to functional area and want to know what is the emerging Hot module in SAP which holds promise in the market.

What is the quickest way to get up to speed on supply chain management?
Member Question: What books or other resources can you recommend to a project and product manager who suddenly wants/needs to learn as much as possible about managing supply chains of diverse products? In the past, my role has involved only product development and marketing, not managing the flow of of raw materials from suppliers, managing inventory, delivery and so forth. I'd be grateful for any resource recommendations.
What IT Systems Are Critical for a Retail Supply Chain?
Member Question: Before throwing open its doors for business, what critical IT systems should a retail chain have in place? How long can this process take?

Vendor/consultant fees: Value for money?
IN MY RECENT TRAVELS presenting the Changing Face of Procurement conference series, a number of interesting trends began to emerge based on the feedback from the majority of those in attendance. Beside a growing cynicism in the "reports" that are published by organizations such as Aberdeen or Gartner, the most prevalent belief is that the cost for initiatives such as the recent $24 million spent in just 9 months by the federal government on AT Kearney are largely based on supporting the vendor's (or consultant's) sizeable infrastructure. In short, the costs are not a true reflection of the service, application or results vendors are providing. With a 75 to 85 percent rate of e-procurement initiative failure, it is hard to argue this point.
How not to abandon your e-procurement initiative
MARK HENRICKS' ARTICLE "Flaw and Order" (Entrepreneur Magazine, September 2004) referenced a behavioral economics study that identified the eight hidden strategy flaws frequently championed by corporate decisionmakers. The sunk-cost effect - based on the premise of throwing good money after bad - and the herding instinct are the two that seem to relate specifically to the challenges associated with e-procurement initiatives.

Technology's Diminishing Role in an Emerging Process-Driven World (Part 1)
Organizations that already have a technology driven program in place or have just recently implemented one still surprise me with their significant interest in the dramatic changes in procurement methodologies and practices. But rather than focusing learning on new and emerging technologies, today's procurement professionals seek insights into the actual processes that drive their enterprises. The impetus behind this change is largely the result of the fallout from the consistently high level of e-procurement initiative failures. Industry studies for the period 2001-2005 indicate 75-85 percent of all programs fail to achieve the promised results.

Public Sector Procurement and the Wal-Mart Effect
In Part 4 of my Changing Face of Procurement conference series titled Winning Strategies for Vendor Engagement I ask attendees the question; “is your current e-procurement initiative a threat or a benefit to your supply base?” While the answer is of course important, what is of greater significance is whether or not your organization has even considered the impact its current strategy is having on these important external stakeholders.

My Account
In Part 1 of this posting, I shared with you information from my recent interview with Bob Sievert (Director, eProcurement Bureau for the Commonwealth of Virginia). As indicated, Bob had contacted me in response to the Ariba posting (The Ariba Interviews: Re-engineering the Future of On-Demand, August 31, 2007) indicating that their experiences would “fit nicely” with that article. Needless to say, it did in that it emphasized a number of key points including the importance of leading with process understanding versus technological capabilities.

Yes Virginia Revisited Why some eprocurement initiatives succeed and others dont
In a recent post that appeared in my Procurement Insights Blog titled The Ariba Interviews: Re-engineering the Future of On-Demand, I reviewed a series of interviews I had with a senior executive from Ariba as well as members from the company’s PR firm. Of the considerable feedback I received as a result of the posting the most interesting (and insightful) comments came from the Commonwealth of Virginia.
Dangerous Supply Chain Myths (Part 7)
Segment 7 – Enabling Technology: The Emergence of the Metaprise Enabling Technology Technology is the key in the supply chain organization of the future. The right technology will enable enterprise-wide supply management, external supply chain visibility, and internal and external collaboration.

Dangerous Supply Chain Myths (Part 2)
Segment 2 - Supplier Development and Management: The Fruit of a Poisonous Tree? Supplier Development and Management Effective supplier development and management should deliver a competitive advantage in cost, quality, delivery/responsiveness, technology, and innovation achieved.

Recent ISM, CAPS and Kearney Report Perpetuates Dangerous Supply Chain Myths
While generally interesting, the recent 10 Page Report by ISM, CAPS and Kearney perpetuate a number of the myths that actually fuel the high rate of e-procurement initiative failures. Focusing on what is referred to as the “seven critical supply strategies” for Succeeding in a Dynamic World, I will address each “strategy” over the next seven day period referencing the results of our 15 years (and counting) of research findings and front line experiences.

Reader Response to SMEs Once Again Voice Concerns Over GoC Shared Services Strategy
Reader Comment And the second point is - is this a boondoggle in the making? My understanding is that departments are not falling over themselves to buy in to this initiative. But they have to subscribe, at least on paper, if they want funding from Treasury Board. I suspect many departments are paying lip service, waiting to see how it will all unfurl. Does anyone have a good knowledge of what the real situation is?

Other e procurement Related Articles

Technology's Diminishing Role in an Emerging Process-Driven World (Part 1)
Organizations that already have a technology driven program in place or have just recently implemented one still surprise me with their significant interest in the dramatic changes in procurement methodologies and practices. But rather than focusing learning on new and emerging technologies, today's procurement professionals seek insights into the actual processes that drive their enterprises. The impetus behind this change is largely the result of the fallout from the consistently high level of e-procurement initiative failures. Industry studies for the period 2001-2005 indicate 75-85 percent of all programs fail to achieve the promised results.

How does policy either motivate or undermine employee performance?
In an excerpt from a November 20th post in the Procurement Insights Blog titled "How Leadership Repeatedly Under-Mines Their Most Valuable Procurement Asset" (see below), I discussed the impact that current procurement policies and environments have on purchasing professionals within their respective organizations.

What are the 3 biggest challenges faced by supply chain/purchasing professionals today? (Survey Result 1)
There are many factors both internally as well as externally that are affecting supply chain/ procurement practices today. From the growing talent vacuum to the continuing lack of collaboration between Finance, IT and Purchasing relative to corporate initiatives. What in your own experiences and opionions are the top 3 issues that procurement professionals face?
What are the 3 biggest challenges faced by supply chainpurchasing professionals today? (Survey Result 2)
There are many factors both internally as well as externally that are affecting supply chain/ procurement practices today. From the growing talent vacuum to the continuing lack of collaboration between Finance, IT and Purchasing relative to corporate initiatives. What in your own experiences and opionions are the top 3 issues that procurement professionals face?

What are the 3 biggest challenges faced by supply chain/purchasing professionals today? (Survey Result 3)
There are many factors both internally as well as externally that are affecting supply chain/ procurement practices today. From the growing talent vacuum to the continuing lack of collaboration between Finance, IT and Purchasing relative to corporate initiatives. What in your own experiences and opionions are the top 3 issues that procurement professionals face?

What are the 3 biggest challenges faced by supply chain/purchasing professionals today? (Survey Result 4)
There are many factors both internally as well as externally that are affecting supply chain/ procurement practices today. From the growing talent vacuum to the continuing lack of collaboration between Finance, IT and Purchasing relative to corporate initiatives. What in your own experiences and opionions are the top 3 issues that procurement professionals face?

What are the 3 biggest challenges faced by supply chain/purchasing professionals today? (Survey Result 5)
There are many factors both internally as well as externally that are affecting supply chain/ procurement practices today. From the growing talent vacuum to the continuing lack of collaboration between Finance, IT and Purchasing relative to corporate initiatives. What in your own experiences and opionions are the top 3 issues that procurement professionals face?
The Greening of Procurement Revisited (Part 2)
As a follow-up to my post from earlier this week, I am pleased to present Part 2 of the 2 part Greening of Procurement Series: It’s Not Easy Being Green! For those of you who would like to delve even deeper into the factors that are shaping both public and private sector sustainability strategies, including case studies on companies such as Kodak and Ford, you can purchase ($20) my white paper titled The Greening of Procurement: How Social Consciousness is Re-Shaping Procurement Practices (contact the author for ordering details)
How Your Procurement Practices Affect Your Sales and Brand
Ethical selling and procurement (purchasing) is now in the spotlight. Harvey Norman’s recent publicity surrounding their supposed sourcing and use of Australian native old growth forest timbers in their Chinese made furniture has drawn light on retail procurement practices. Procurement is now fairly and squarely in the spotlight and choices surrounding sourcing and distribution activities can have a dramatic effect on a company’s brand, reputation and sales revenue.

Procurement and Purchasing Cards
This article looks at how procurement cards - or P-cards - work to control misuse through setting of parameters on types, amounts, locations and frequencies of purchases. Also addressed are benefits and drawbacks of procurement card programs.

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