Archive for April, 2015

Managing the Risk of Sourcing Projects – Part II of II

Tuesday, April 14th, 2015

 

Today’s post is from our SafeSourcing Blog Archives

Yesterday we began to look at some of the steps necessary to minimize the risk of sourcing projects.  Understanding the current landscape and reducing complexity were two of the first steps to take so that the types of risks that may be encountered can be identifying and addressed.   Today we will wrap up the series by looking at three more steps to be considered in the risk management approach to strategic sourcing events.

Plan for unknown risk– Once risks have begun to be identified and accounted for the path to risk management begins to get clearer and clearer but as in every plan in life, unexpected and unknown events will always occur.  One of the popular mottos on the popular reality show “Big Brother” is “Expect the Unexpected.”  This statement is no less true in strategic sourcing initiatives and is an important factor to maintaining timelines and producing projects with great results and great participation.  Some of the common areas to build in added time for unknown risk are: information collecting; specification development; supplier engagement and reporting and analysis.  The more time built in however the longer projects will take so there must be a balance in order to achieve successful projects whose results are able to be realized in a timely manner.

Use your tools– There are many tools that companies have access to that can help with planning for and managing risk be providing “what-if” scenarios and vision into what is happening around them.  Online Survey tools, RFI and RFP tools, Online Bidding tools are all effective means to help build a successful platform for a strategic process.  With so many of these types of tools being accessible through the internet remote resources and suppliers can plan and communicate to each other in a way that provides immediate feedback and collaboration.  When people are working to together the number of surprises and risks begins to go down in direct proportions.

Share in the planning– Include your current partners in discussions as you plan your projects.  Many times companies feel as though they need to covertly plan sourcing events keeping their incumbent suppliers in the dark until the moment that the communication is distributed about the upcoming project.  Some companies do this to reduce the impact on their current service however in many cases, collecting information from your current partners about the services they provide can give them an opportunity to let their customers know what additional services they are currently providing that are not part of the initial scope.  These are the types of things that should be accounted for so that any new suppliers can be measured against what a company is currently getting today.  While no supplier likes to run the risk of losing current business, they must understand that in today’s world expenses must be constantly reviewed.  Good suppliers will know that they have offerings that are unparalleled and will be more than willing to collaborate with their customers in advance of a new project.

At SafeSourcing we are constantly working with organizations to assist them with their sourcing needs in a strategic way.  Part of a successful process begins with understanding and planning for the risks that may occur well in advance.  For more information on how we can help with your projects or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

Managing the Risk of Sourcing Projects – Part I of II

Monday, April 13th, 2015

 

Today’s post is from our SafeSourcing Blog archive

Risk Management is a term associated with so many areas within a company that there are even entire Risk Management departments dedicated to the protection of a company and its assets, both material and personnel. 

It is no small wonder then that the concept of managing risk within procurement projects is becoming increasingly important as companies move from reacting to challenges they face during the course of a project to planning for the risks in advance of the projects ever beginning.  As companies begin to embrace a style of sourcing that maps out their goals and projects in structured plans, there are important steps needed to achieve this.  To truly understand and plan for risk with a sourcing project we will look at some of those steps to take over the next two days that can help with execution.

Understand the current landscape– Many companies struggle with determining and forecasting risk associated with projects because they do not truly understand what they are doing today.  As example, Company ABC wants to begin structuring a project to make some decisions on their Temporary Labor spend.  They have spend numbers by month and by company location.  They know who their incumbent providers are and they have contracts and invoices that tell them the landscape of what they are currently paying and what level of service they are supposed to be getting.  This is great information except that it does not include insight into a possible strike in one of the locations or the requirement of employees to belong to the local union to be considered other locations.  These special circumstances begin to create the profile of risk associated with a sourcing project.  Risks can be a non-issue if they are planned for and known about in advance; a good way to use internal survey tools to get the information needed.

Determine and Minimize Complexity– It is a common process by many companies to look at a category and in the name of a consolidated National contract, attempt to tackle every aspect of it.  If there is enough time to proceed in this manner and the executive support and personnel are in place this can lead to great results.  Since many companies do not have the resources for a project of this size, it is important to focus on the aspects with the greatest impact.  If the plan is to reduce 100 suppliers to 10, focus the event in a way to accomplish that.  Create one year agreements, work through the transition to the smaller set of suppliers and then in year two, determine if more consolidation is needed or a more focused savings project is conducted with a resulting multi-year deal.   If the plan is to try and get savings for a catalog of 800 items, determine the items that make up the top 80% of spend and focus your and the suppliers’ attention on those items rather than the whole catalog.  Reducing the complexity of events gets a large chunk of success quickly in a way that takes fewer resources to conduct.

At SafeSourcing we are constantly working with organizations to assist them with their sourcing needs in a strategic way.  Part of a successful process begins with understanding and planning for the risks that may occur well in advance.  Tomorrow we will conclude this series with three additional steps you can take to manage risk.  For more information on how we can help with your projects or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to your comments.

Sourcing Options for Large Variety Categories

Friday, April 10th, 2015

 

Today’s post is a favorite of the  SafeSourcing Archive.

There are thousands of categories that businesses purchase every year that are “complicated” to say the least.  Categories like office supplies, for instance, involve thousands of individual items that a company must purchase in order to do business, but that can be very difficult to source in a manner that provides the best benefit to the company.

Let’s take a look at the process of sourcing these types of categories from one extreme of the complexity spectrum to the other with a couple of options that meet towards the middle.

Sourcing the market basket – The first end of the spectrum is to take the entire collection of all items in the category and source them as one large market basket that will be represented by a discount off of the vendor’s list pricing.  One obvious pro of this approach is that it is easier to collect and manage an overall discount from a supplier than anything else and is one reason why procurement departments sometimes take this approach.  On the downside this approach does not allow you to focus on items that have higher spends and because each vendor will have different beginning list prices, an overall discount can sometimes be misleading when comparing vendors side by side.

Sourcing every item – At the other end of the spectrum is the approach of gathering pricing and proposals on every item in the category.  The advantages to this approach is that it allows you to show where your purchases are heavier for the vendors and it gives you absolute pricing and comparison of the group across all proposals from the vendor community.  The trouble with this approach is that when you are looking at 4,000 items this can be a time-consuming task for the vendors to complete and for your team to evaluate at the end, and in some cases vendors do not have the capability to provide unique price sheet pricing on a customer by customer basis.

Group Discount Sourcing – In the group discount approach you collect discount pricing off of list on a product group by product group basis which allows you to split your spend into smaller areas for the vendors to focus on providing more competitive quotes in the areas you need them most.  Also, many vendors support this approach in their internal systems much easier.  The downside in this approach is like the first approach where the list prices of the vendors can vary a great deal making a straight discount to discount comparison more difficult to evaluate. 

Hybrid Sourcing – The final approach is one that takes the positive elements of all three and blends them together.  This approach leverages the individual focus pricing on items making up the majority of your spend.  From there, the majority of what is left is split into product groups market baskets, with a final market basket of products gathering a discount off of list representing no more than 10% of the spend.  The advantage for your company is that you have the focus in all the areas you need and discounts on areas that aren’t as large.  The downside is that many vendors are not generally equipped to handle this approach on an account by account basis so it may require more effort on their part in order to support you and the hybrid pricing model. 

Regardless of how you choose to source these types of categories there is a model that fits for you and your business.  For assistance in sourcing these categories for your business, please contact a SafeSourcing Customer Service Representative

We look forward to your comments.

Can I use my iPad as a laptop replacement?

Wednesday, April 8th, 2015

 

Today’s post is by Troy Lowe; Vice President of Development at SafeSourcing.

Have you ever wondered if you could substitute your iPad for your bulky laptop?  I’ve researched this a few times over last four years and never found the solutions for all of the tasks that I wanted to accomplish.  I use Microsoft Office for editing and creating.  It wasn’t available for the iPad.  I looked for other alternatives but never found any that I liked.  Now, with the recent release of Microsoft Office for the iPad and a few other new devices, this can be done.  Below are a few things that I have found that can help you to get started.

•  Keyboard Case
•  Microsoft Office – Word, Excel, Power Point apps
•  USB Camera Adapter – Import Photos, videos from USB Camera
•  5 in 1 Card Reader – Import Photos, videos via SD(HC),MS DUO,MMC,M2,T-FLASH cards, USB cable or USB flash drives
•  Credit Card Reader/Service
•  AirPrint Printer – Print wirelessly from iPad
•  Portable charger – Extend battery life when on the go

These items, along with the millions of apps available in the App Store, make for a great user experience.  If you would like more information on how SafeSourcing can help you get started with your technology purchases, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

We look forward to your comments.

What should you be looking for in a new laptop?

Tuesday, April 7th, 2015

 

Today’s post is by Troy Lowe, Vice President of Development at SafeSourcing.

Is it a good time to invest in a new laptop?  There a lot of good deals available from all the major brands.  Whether you need a new laptop for business or for home, there are a lot of things to consider from size, speed, memory, and features.  Below are some things to consider when you are researching your next laptop computer.

Size and weight for portability

The heavier the laptop, the less portable it will become.  Keep in mind where and how you will use the laptop.  If you will be traveling a lot, you may consider a small light-weight laptop

Size of screen and resolution

Depending on what you will be using the laptop for will help decide which size and resolution you need.  If you are using the laptop for business, then you will most likely want to go with a small to mid-size screen (11”-14”) for portability.  If you are thinking of replacing a desktop computer at home, you may want to go with a larger size (15”-17”).  This will be large enough to replace your current monitor and view videos.

Processor

The processor effects how fast a computer will run the installed software and how many software programs that you can run at a given time.  With a faster processor comes more efficient multi-tasking.

Graphics

The graphics processor is used to display the content to the screen.  If you are planning on using the laptop for video and gaming, look for a laptop that has a dedicated graphics chip.  Integrated graphics chips are fine for most business applications and some support 1080p video.

Storage

There are different types of internal drives available.  Hard Drives, which most laptops still have, are less expensive.  Solid State drives, which are more expensive and more reliable, don’t rely on moveable parts. 

Memory

Every software program that runs on the laptop uses the Random Access Memory (RAM) to store information, including the operating system.  This is one feature that you will want to upgrade if possible. 

Along with the items listed above, there are many other things to consider when buying your next laptop.  At SafeSourcing, we can gather all the necessary information and help you decide what laptop would be a good fit for your needs.  If you would like more information on how SafeSourcing can help your business, please contact a SafeSourcing Customer Service representative.  We have an entire team ready to assist you today.

We look forward to your comments.

Communicating openly with suppliers is a key to high quality e-procurement events.

Thursday, April 2nd, 2015

 

Todays post is by Ronald D. Southard, CEO at SafeSourcing Inc.

We?ve all known for a while that our seat partners look over our shoulders to see who we are and what we do. I told him I was reading an Aberdeen business brief and who and what they do. I went on to explain that our company was focused on the use of ?e-procurement tools for?or customers. He introduced himself as a private business owner with his two brothers and that he had experience biding in reverse auctions with these tools.

We discussed SafeSourcing?s offerings and ultimately came around to what made e-procurement events successful for his company in the past as a prospective supplier and what would encourage them to participate again even if they did not happen to be awarded the business in a particular event. His take was that this was initially an educational process for their company and ultimately would become a way to do old things in a new way. He also suggested the following

1.?Openly communicate with prospective suppliers
2.?Make sure they understand everything and comfortable
3.?Make sure they have no open questions.

With that as an understanding I offer the following list of sample questions one might consider when inviting a supplier as a new participant.

1.?Does the supplier understand that there is no cost to them to participate?
2.?Do they understand they will be trained at know charge?
3.?Do they understand event timing and requirements?
4.?Does the supplier understand the terms being used and how they apply to an e-procurement event such as? In fact, do they understand what a reverse or forward auction is?
a.?Reserve Price
b.?Proxy Volumes
c.?Low Quote
d.?Proxy quote
e.?Funds
f.?Terms
g.?Notes
h.?Extensions
i.?Matching quotes
j.?Event? rules
k.?Product specifications
l.?Samples
m.?Award of business

At the heart of it, it comes down to something we all know but don?t always practice and as such negatively impacts the sustainability of processes that just make good sense. And that is that the supplier is your customer too and the customer comes first and should be treated the way you would like to be treated.

If you’d like to learn more about?SafeSourcing’s ?quality approach to supplier management during the eProcurement process?and why our satisfaction rating is 99.999% with our vendor participants, please contact a SafeSourcing Project Manager

We look forward to and appreciate your? comments.