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02.05.2016
SME my EYE aka Traditional vs Strategic Procurement
I have previously stated that it is important to keep ones friends close and in our world of Procurement, that means our Supply Partners.
We have recently done a poll and asked suppliers how often they get to meet their Procurement customer representative. The results did not surprise us at all.
63% said once a year at pricing talks
87% when the contract is up for renewal and
36% said they were told they had lost a contract without prior interaction from Procurement
This is criminal. If Procurement does not get out and meet their supply partners on a regular basis or meet with other suppliers in the market, then they will not be able to bring value added service to their organization.
Specializing in a certain area of business in Procurement is known as being an SME (Subject Matter Expert). Once a year a Category Plan (Traditional Procurement) is devised giving the lay of the land around competitors, price impactors etc. However, how can you call yourself a SME if you do not know to the day what and who is out there in the market that might help your organization to gain on the competition or make a quantum leap in its market offering? To be a true SME one needs to know their own and similar industries backward and they need to look at a supplier not just as one entity, but need to look at them as a whole Supply Chain. Each of your suppliers is a Supply Chain and their suppliers is a Supply Chain etc. Explosive Supply Chains (Strategic Procurement) is where the true SME needs to live and breathe. Unless Procurement brings this mindset to the organization, it will always remain an under-appreciated support function.
We are a Global Procurement, Supply Chain and Business Consultancy specialising in Supplier Vetting and Management, Business Analytics, Business Interpretation and Translations, Contracts Management,…
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