Archive for the ‘Procurement Solutions’ Category

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Quality retail e-negotiation in a time of heightened Corporate Social Responsibility (CSR)

Friday, February 12th, 2010

Why do some companies succeed while others continue to implement program after program with no measurable benefit. First among these is the recognition that effective e-negotiation initiatives like any successful program requires strong support from the executive suite. In Retail this is important because the industry lags well behind other industries in utilization rates of e-negotiation tools. At a minimum in order to get off on the right foot, this means the involvement and sponsorship of your CEO, CFO, CLO or CPO is critical. Once you have this involvement directives can be issued. This will help in the required next step which is to identify savings targets across all corporate spend categories. Once these targets are identified and ranked, a category specific attack plan can be developed that best maximizes savings opportunities. It is important to note, that savings alone do not create a successful e-negotiation plan. What can not be sacrificed in the name of cost reduction is quality, which can include safety as well as Corporate Social Responsibility (CSR) goals including environmental support programs.
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A key challenge for any procurement team directed to implement e-negotiation tools across all of their unique spend categories, is to not over complicate the process into something that can?t be maintained. At a high level, the following 10 steps which are in no particular order offer some assurance that you are headed down the right path.

1.?Identify and rank all opportunities by spend
2.?Locate all contracts and identify termination language
3.?Document your safety and environmental goals
4.?Develop a total company strategy
5.?Source qualified suppliers
6.?Identified fragmented or maverick purchasing and aggregate
7.?Negotiate final terms and conditions
8.?Award of business
9.?Contract completion including review of evergreen and termination language
10.?Results Analysis

Most quality e-negotiation? solution providers have well developed and well thought out plans that will aid you in developing and implementing your best practices while maintaining quality and supporting your CSR initiatives.

We look forward to and appreciate your comments.

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SafeSourcing trains hundreds of suppliers every week to use e-negotiation tools to their benefit.

Tuesday, February 9th, 2010

SafeSourcing Inc. places a great deal of value in our SafeSourceIt?? Retail Supplier Database of over 350,000 suppliers located in Mexico, Canada the United States, China, Korea, The United Kingdom and the European Union? Additionally we also place a great deal of value on each individual supplier regardless of size. We believe that well thought out next generation e-negotiation tools can provide significant benefits to buyers and suppliers whether they are hosting or participating in e-negotiation events such as reverse auctions of RFI?s.?

Some but certainly not all benefits that suppliers can anticipate from SafeSourcing are:
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1. An easy to use e-negotiation tool limited to a single page view where a supplier can be completely comfortable that their company?s best foot is being put forward to the soliciting company.

2. An increase in new business opportunities through engagements they would otherwise not be exposed to.

3. Clean data about the soliciting company and an accurate listing of their event guidelines, specifications, terms, conditions and other information necessary to build an accurate and successful pricing strategy.

4. Best practice training in event participation and strategy development.

5. A clear focus on what?s important beyond price in next generation e-negotiation tools such as supplier safety certifications and practices as well as their environmental programs that will differentiate them from other suppliers.

6. Closed loop reporting of results of the specific e-negotiation event a supplier participates in as well as a detailed supplier feedback questionnaire report.

7. Significant time savings associated with new business development that becomes more and more costly as fuel and other related prices continue to rise.

8. Industry pricing trends extrapolated from their view of low quote information during the event if allowed by the soliciting company.

9. Use of the same e-negotiation tools for their own procurement needs.

10. Introduction to an educational website that provides all sorts of free tools for procurement professionals use including a daily safety alerts from over 25 sources, a daily sourcing blog, a? sourcing wiki and SourceBook? the industries only social network for procurement professionals.

We look forward to and appreciate your comments.

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Giving it your best is more than a practice.

Friday, February 5th, 2010

Best practices only become best practices through a thoughtful paying forward of one?s careers learning to others in order to shorten their educational curve to the ultimate benefit of customers, partners and other stakeholders they may interface with in the hope that they will do the same thing.

According to Wikipedia a best practice asserts that there is a technique, method, process, activity, incentive or reward that is more effective at delivering a particular outcome than any other technique, method, process, etc.

When a company indicates to you that they use best practices, does this mean they are supporting what is the best practice for the entire industry they serve such as the procurement space. Or does it mean they are the best practices for just their particular product family?

This author does not believe that a best practice is just following a standard way of doing things that can be carried out by multiple organizations. A best practice is a life long process that by its nature has to evolve over time as tools, businesses, and existing processes change so that a current practitioner performs similar tasks more efficiently or cost effectively.

If one uses best practices, the result should?be an ideal state that a person or an organization set out to achieve in the first place. In fact if the process used is actually a best practice shouldn?t all of a companies customers use exactly the same process. I?m not sure that this is ever a question one asks when looking for a referral about a companies service offerings. Please tell me about your companies? best practice? Are they consistent and carried out each and every time to the desired result?

One way to ensure good quality results is to provide templates that can be used over and over again and are evaluated at the completion of each practice or session of a particular deliverable and changed as need be. This then requires passage to other customers in order to insure the integrity of the process. This elevates the actual process beyond just a buzzword and moves a particular process in the direction of becoming a best practice that drives similar results on a consistent basis regardless of customer.

This author will continue to refer to our services offerings as high quality process techniques focused on continuous improvement that deliver anticipated results. Our customers, supplier participants and business partners will determine if they are best practices for them.

We look forward to and appreaciate your comments.

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Retailers; who monitors your supplier?s safety performance?

Tuesday, November 17th, 2009

This is an even more complex issue when you consider that in order to do so data is required from your organization relative to the historical performance of your existing suppliers, data from the supplier as to their own assessment of their historical performance and finally other types external data that neither you or your incumbent may have.

When we talk safety, the question that retailers need to ask their suppliers is pretty simple. What certifications do you carry relative to food safety such as Safe Quality Foods (SQF), Global Food Safety Initiative (GFSI), American Humane Certified and many more? Additionally you should question all suppliers and manufacturers relative to their USDA and FDA inspection history.

Although Green Initiatives fall into the area of the social consciousness of a company, there are a variety of questions that should also be asked in this area as well such as what are your own companies green product initiatives such as Green Seal, Eco-logo and Green Star certifications and participations and how do your existing and new suppliers support or plan to support these same initiatives.

As retailers consider their alternatives in these areas, it may be easier for them to rely on their e-procurement solution providers for this data if the provider has it included in their supplier database. Pre-populated e-procurement templates can also act as a form of scorecard for existing suppliers and potential news sources of supply. This is actually a type of automated RFI process which can save retailers a lot of work and time when trying to find additional sources of supply or when trying to drive cost down with existing suppliers. These data may also help to protect retailers from harmful litigation when products end up not being as safe as promised.

If your existing e-procurement provider can not provide these types of data on demand as a normal byproduct of your standard e-procurement process at no additional cost, you should consider changing providers?

As always, we look forward to and appreciate your comments.

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Retailers; who monitors your supplier’s safety performance?

Tuesday, November 17th, 2009

This is an even more complex issue when you consider that in order to do so data is required from your organization relative to the historical performance of your existing suppliers, data from the supplier as to their own assessment of their historical performance and finally other types external data that neither you or your incumbent may have.

When we talk safety, the question that retailers need to ask their suppliers is pretty simple. What certifications do you carry relative to food safety such as Safe Quality Foods (SQF), Global Food Safety Initiative (GFSI), American Humane Certified and many more? Additionally you should question all suppliers and manufacturers relative to their USDA and FDA inspection history.

Although Green Initiatives fall into the area of the social consciousness of a company, there are a variety of questions that should also be asked in this area as well such as what are your own companies green product initiatives such as Green Seal, Eco-logo and Green Star certifications and participations and how do your existing and new suppliers support or plan to support these same initiatives.

As retailers consider their alternatives in these areas, it may be easier for them to rely on their e-procurement solution providers for this data if the provider has it included in their supplier database. Pre-populated e-procurement templates can also act as a form of scorecard for existing suppliers and potential news sources of supply. This is actually a type of automated RFI process which can save retailers a lot of work and time when trying to find additional sources of supply or when trying to drive cost down with existing suppliers. These data may also help to protect retailers from harmful litigation when products end up not being as safe as promised.

If your existing e-procurement provider can not provide these types of data on demand as a normal byproduct of your standard e-procurement process at no additional cost, you should consider changing providers?

As always, we look forward to and appreciate your comments.

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Seventy nine percent (79%) of college students would prefer to work for a green company.

Friday, November 13th, 2009

With all of the issues facing our planet, both future and present employees are weighing their decisions as to prospective work places on more than just money. Are your human resource procurement professionals savvy enough to your company green practices and policies to attract the best and brightest?

Procurement does not only relate to the products your company buys for resale or supplies that your company uses internally. If you ask a human resources (HR) professional they are in the procurement business as it relates to people. In fact many of the tools they use during the recruitment process can in fact be sourced to reduce their cost using reverse auctions such as background checks and drug screening kits. First however they need to get the best candidates to want to work for you. So, these are not the most important products for human resources professional to be concerned with.

The job of human resources when conducting an interview is to sell your company, to make it the first place someone wants to interview and the last place they want to leave once hired. Increasingly, the social conscience of your company is becoming a deciding factor as to whether or not quality candidates want to select you as a place to work. The first question this begs, is your human resources department in a position to clearly discuss your company?s corporate social responsibility programs and initiatives (CSR)?

In a conducted by experience.com of 2,774 college students, the following question was asked. If you had two job offers and one company was ?green? would that have an impact on your decision? A full seventy nine percent (79%) answered yes. Let?s hope your CSR program leads to the need to use the other products required in this process because your human resource professionals are armed with a strong story.

We appreciate and look forward to your comments.

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Is it a poor marketing strategy, a just noticeable difference or both? You decide!

Monday, October 26th, 2009

The first time I ever heard the term just noticeable difference or jnd I was studying psychology in college. The professor used the candy bar as an example to describe the term. He began by asking the question as to whether or not we thought the candy bars that kids got at Halloween these days were the same size as they had been during our childhood. This immediately hit home with me as I already had a child and was embarrassed to give out those tiny candy bars that were much smaller than I received as a kid. The funny thing is that today?s kids never seemed to mind.

Our professor went on to explain that if a candy bar were made just enough smaller so that you would not notice that consumers would still buy it for the same price. If you continued the practice over time the product would become smaller requiring fewer ingredients and smaller packaging. The product could now be sold at the same price with lower costs and little flack from consumers.

By definition, a just noticeable difference, which is normally abbreviated as jnd, is the tiniest detectable difference between a starting and next level of a particular sensory stimulus. Human sensory systems do not respond identically to the same stimuli on different occasions which explains the candy bar story..

I?m sure you are wondering how this relates to procurement and my sandwich?

I have a favorite place that I frequent for lunch that is owned by a supermarket company that has fallen on hard times recently. Their high end store has a wonderful selection of items for lunch including salad bar, a terrific deli, pizza, and an outdoor grill. One of my favorite items is a grilled rib eye sandwich. I have commented to many people that this is the best steak sandwich in the country. Historically the steak hangs outside a large bun and is about a half inch thick. My guess would be that it?s at least a seven ounce piece of meat.

This sandwich is something I probably only order once month but look forward to. Recently I decided that I was going to have one and placed my order and went to sit and wait for the sandwich. When I went to pick up the sandwich it was handed to me in a much smaller box (clue). When I opened it to add condiments, I noticed nothing hanging out side the bun. Removing the top of the roll, I noticed a piece of meat that was much thinner and folded which would not have been possible previously. So much for the jnd approach. I was still paying the same price for this much smaller product, and was not happy.

Obviously this company is trying to reduce costs, and that?s ok. In this case they are either ordering or cutting much smaller pieces of meat for this sandwich which saves them money and then trying to sell the product for the same price to consumers, and that?s not ok. Consumers may miss psychological practices like jnd used over a long period of time. We do however pick up on very large changes that are made that result in a cost benefit that does not include us.

Consumers understand when companies fall on hard times and that sometimes drastic actions need to take place. Companies should however be careful to not make business and marketing decisions that have a negative impact on their brand or consumer loyalty.

There are numbers of ways to reduce the cost of goods and services that this author posts on regularly. There are many great marketing opportunities that can result from cost savings. Many of these can positively impact consumers and result in improved loyalty and increase market share.

We look forward to and appreciate your comments.

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SafeSourcing Website experiences significant traffic growth.

Thursday, October 22nd, 2009

During the last ninety day period the SafeSourcing website www.safesourcing.com has experienced significant growth globally. According to a number of rating services including Alexa and Google Analytics our website has had visitors from thirty seven (37) countries. Our reach which is a percentage measure of global internet users has grown 130%. Our traffic rank has increased 168% and our page views have increased 150%.

This growth places us amongst the top websites in the procurement space. Spend Matters and Sourcing Innovation continue to be the ranking leaders in our space. Both are required daily reading for this author.

We are very proud of our growth as it indicates that SafeSourcing is providing valuable content to regular visitors as well as registered members. We are also enjoying a good mix of both returning and new users. In reviewing these data the entire website is being explored on a regular basis including the following areas.

1. Sourcebook our professional social network for procurement professionals.
2. The SafeSourcing Wiki
3. The SafeSourcing daily Blog
4. SafeSourcing environment and safety alerts
5. SafeSourcing specifications template library
6. The SafeSourceIt? Supplier Database
7. The SafeSourcing Query tool
8. SafeSourcing Product Information Sheets
9. SafeSourcing White Papers
10. SafeSourcing Press Releases.

Thank you to those of you that have allowed us to achieve this growth.

As always, we look forward to and appreciate your comments.

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Try using a little wizardry or sorcery in your retail procurement practices.

Wednesday, October 21st, 2009

From a purely systematic or technological perspective, a wizard is a computer user interface that leads a user through dialog steps in order to accomplish something easily or for the sake of appearances magically. So to begin with if you are not using technology in your retail procurement practices this would be a good place to start. You can never tell improved profits may simply be as easy as abracadabra.

Magic which is practiced by wizards is the act of performing, entertaining or enlightening an audience by creating illusions of seemingly impossible feats, using purely natural means. As an example; maybe finding new sources of supply in order to compress a retailers pricing is as simple as having access to a supplier database (hidden knowledge) that can conjure up new sources of supply through an easy to use interface (wizard). Since most retailers do not know that such a database exits, a novice supply chain team member or apprentice (audience participant) could conjure up a query on their PDA (magic wand) that searches this database (universe) by major category, country, postal code, sub-category, safety certifications or other incantations, and in less than 15 seconds produce a result set of 200 suppliers seemingly from thin air. This act of prestidigitation to most retailers would appear as magic. To his or her boss (lord or lady) this novice or apprentice team member would be looked at as a wizard, magician or seer.

Call your solution provider and see what type of sorcery they can share with you. If they can?t, call SafeSourcing the sorcerers of sourcing.

We look forward to and appreciate your comments.

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