Wednesday, 27 March 2013

Supplier Relationship Management: Crucial to Supply Chain Success and EPS

Authored by Sara Omer

Much has been written about Supplier Relationship Management (or SRM), from the process of SRM, to the value of SRM, to issues with SRM. SRM is crucial to improving operating margins, return on invested capital, return on assets and earnings per share. But few companies focus on the value that can be derived from their supplier relationships. A few months ago I had a discussion with a client on how to improve their supplier relationships. When I asked what the issues were I received the following responses:

Monday, 25 March 2013

Supply Chain Risk Management Tools

Authored by Mickey North Rizza

A recent survey from Deloitte of 600 global supply chain executives reveals a wide range of tools used to manage risk. Of this list of technology tools, very few respondents use some of the top risk tools — only 36% report using predictive modeling and only 29% use risk sensing data, worst case scenario modeling and business simulation tools.

In my own discussions with many Supply Chain leaders, I found one thread in common with the Deloitte risk management findings: supply chain risk management technology utilized in a silo does not deliver full value until it is coupled with additional data sources, advanced capabilities and applied to problems within the supply chain. One executive told me technology tools are definitely enablers, but the linkage and pushing the technologies capabilities to solve the supply chain problems is where the rubber meets the road.

What do you use for supply chain risk management tools? I would love to hear from you on your successes and failures regarding supply chain risk management tools.

Thursday, 21 March 2013

The Real World Sourcing Series

Tejari in partnership with CIPS MENA are hosting a set of educational briefings in Dubai throughout the year that focus on relevant topics in the procurement industry.

So what can you expect?

4 afternoon briefing events delivered by
industry experts, held over the course of 2013. At the end of each briefing event, delegates will have the opportunity to take an online certification for the briefing.

Who should attend?

These events are practical, experience based briefings delivered by industry experts. The briefings are aimed at CPO’s, Heads of Procurement, and Procurement & Sourcing Directors. Alternatively, your CPO or Head of Procurement could nominate you and/or members of your team to attend these briefings.

What happens on the day?

Coffee and registration will be followed by the first of two one hour briefing session, then by practical exercises and tasks based on the briefing which all delegates are expected to participate in. There will then be a short break with refreshments and a chance for delegates to network, then on to the second one hour briefing session and finally an opportunity for delegates to ask some questions before the summary of the two briefings.

The first event will be on
Making Spend Analysis Work & Taking on a New Category on 3rd April 2013.

The first briefing of the year is free so

Register to attend the remaining 3 events here

Wednesday, 20 March 2013

A New iPhone, Already?

Authored by Fayaz Haq

Apple’s iPhone5 was released less than a year ago, but online speculation immediately began regarding when we would see a new iPhone model. The latest rumours point to a release date for the iPhone5S as soon as this summer. Consumers might be excited, but this rapid innovation is placing major pressure onto Apple’s supply chain. Long gone are the days of relying on the “cash-cow” product that could sit on the shelves for years without updates or upgrades. 

Tuesday, 19 March 2013

The CFO’s Number 1 Concern in 2013: Rising Costs (Part 2)

Authored by Asif Khan

Rising costs will always worry CFOs, but what other risks are on their minds? 

  • Supplier compliance. This encompasses elements of supplier relationship management – from delivering what the company needs when it’s needed, at the agreed upon price, to complying with ethical standards. Supplier compliance has dominated recent headlines, especially regarding Wal-Mart’s stronger regulations on unauthorised subcontracting.
  • Economic risks. While there are signs that the economy is improving, companies are closely watching for any wavering indicators of regression that could affect customer spending, currency values and global growth.
  • Effectiveness of internal IT spending. Departments will have a more difficult time justifying major investments in technology. And post approval, there will be more pressure to demonstrate that the actual results were equivalent to the proposed ROI. Something to consider: Taking blind risk is dangerous, but taking risk backed up with the right data and insight is what separates truly innovative companies and the laggards.

Monday, 18 March 2013

The CFO’s Number 1 Concern in 2013: Rising Costs (Part 1)

Authored by Asif Khan

Although it’s rather obvious that CFOs always have money on the mind, the CFO Survey 2013, published by 4C Associates, highlights that rising prices are a growing worry for procurement’s finance colleagues: 65 per cent of participants listed ‘price risk’ as their top concern – up more than 15 per cent since last year.

Most companies are still struggling to combat volatile commodity prices and rising inflation. Indirect costs are climbing on the operational side, too. Yet, customers have little-to-no sympathy about the plight of corporations because they face a similar battle: the skyrocketing cost of living with stagnant wages. The result: Companies that pass on cost increases to maintain profit margins risk alienating customers and losing critical sales.

The responsibility to improve margins and deliver more value to the business – and when done well, the glory that comes with it – has been somewhat of a tug of war between procurement and finance. By shifting the dynamics so both departments can become allies, rather than competitors, cost savings will improve, and the process will easier for both parties.

How is your organisation bridging the gap between the procurement team and the finance department?

Check back for the next post on this topic to read about the other risks that worry CFOs.


Thursday, 14 March 2013

What is a Supply Chain?

Authored by Mickey North Rizza

I was with my husband at a recent event and an old friend of his asked what I did in the business world. I told him and then he said, “Wow, is what you do related to what some call Supply Chain?” I of course told him yes, and then this highly educated man said to me, “What’s a Supply Chain?” I laughed and proceeded to tell him the following:

Tuesday, 12 March 2013

Supply Chains Connect Everywhere and Impact our Entire Globe

Authored by Shayda Sharfaei

Sometimes in our own little corner of the world we forget about the rest of the world. Other than a news source we might not plug into the fact that our world is interconnected and the problems we have might just be the same somewhere else in the world. Two completely different corners of the globe bring this to mind with their recent supply chain issues.

Monday, 11 March 2013

Promoting Supplier Innovation (Part Two)

Authored by Sara Omer

On Thursday we highlighted a blog from Harvard Business Review’s Rosabeth Moss Kanter on Stifling Supplier Innovation. For each of the supplier innovation stiflers, Moss Kanter lists ‘Innovation Promoters’ which can have the opposite effects to the stiflers. Again, here’s my pick...

Thursday, 7 March 2013

Stifling Supplier Innovation (Part One)

Authored by Sara Omer

A colleague recently directed me to a great blog post from Rosabeth Moss Kanter at the
Havard Business Review, titled ‘Nine Rules to Stifling Innovation’. It’s a great list of how a company should NOT interact with their suppliers. I’ve picked a few of the ‘stiflers’ here that rang a chord....

Tuesday, 5 March 2013

What is Sustainable Procurement? Part 2 - The Readers' Response

Authored by Fayaz Haq
Last week I circulated a blog post where I asked the question ‘What is Sustainable Procurement?’ The topic seemed to be very popular and a number of you provided great feedback by sharing your thoughts and views on Sustainable Procurement.

The common view was that in general, products that are kinder to the environment are more expensive and that the majority of governments will have sustainability built into their procurement policy but it is up to individuals and key budget holders as to whether or not policy is upheld, and at what financial cost. One individual stated:

“To avoid the whole cost vs. environmental impact issue many focus on social issues such as selecting the winning contractor on how many apprentices it has employed and trained. There are so many factors that can be built into an evaluation matrix... Each contract is unique and in order to extract the greatest amount of socioeconomic benefit each contract needs to be examined closely”

Monday, 4 March 2013

Worlds Collide – Sourcing, Social, Information, Mobile and Cloud

Authored by Mickey North Rizza

The cloud, social, access to information and mobile are driving market forces, and to remain effective, competitive and relevant companies need to embrace them. That particularly rings true for sourcing managers.

Gartner recently released a
report on the impact these forces will have on strategic sourcing in 2013, and in it Frank Ridder, research vice president at Gartner, says that sourcing managers need to better understand “wider IT service market trends” to more effectively do their jobs.

Here’s Gartner’s explanation as to why these four areas are ones to watch –

Sunday, 3 March 2013

Procurement: Put Yourself in the Suppliers’ Shoes

Authored by Shayda Sharfaei

The procurement industry talks a lot about supplier risk and
supplier management, but what about ‘buyer risk?’ More and more stories are popping up in the news and industry publications about big companies – with large cash flows – that aren't paying suppliers on time, or at all.

Bottom line: Failure to meet contract terms (by the supplier or buyer) is a sign of a poor partnership.

Yet, buyers are also now building longer payment terms into contracts, up to 180 days. While that keeps cash in a company’s pockets for the short term, it has a tremendous impact on a supplier’s financial health. And in turn, the supplier’s value and perception of the buying organisation is negatively affected.