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I once worked in quality improvement capacity as Director of TQM for a distribution company for whom the term supply management was a new concept. Purchasing in particular felt that it had no clout or influence over suppliers. The rest of the company saw purchasing as the price choppers and the whipping boy for stock outs. [...] Supply managers and buyers have always had the challenge not just of finding suppliers but finding suppliers who are both high-performing and “best value”. Numerous supplier evaluation and supplier performance management software solutions are now available, where ten years ago very few options existed. Most options that I’m aware of are either SaaS (software as a [...] Companies have typically viewed suppliers as a source of cost that needs to be reduced, as supplier costs directly impact the bottom line. And it’s a given that procurement is always under pressure to fulfill the cost reduction mission. But in the process of viewing suppliers as big dollar signs that need to be squeezed, firms [...] With supplier bankruptcies a daily occurrence, to say that the topic of supplier risk has become hot is an understatement. The challenge is what to do about it. Someone recently asked me whether there are any KPIs you can use to measure supplier risk. There are, but developing those KPIs is a business process that goes [...] I recently wrote a post for the Spend Matters blog, “12 Reasons Why Supplier Scorecards Fail” (updated, with one additional reason than my original post on this site in December 2008). There were some insightful comments, including one about the customer’s role in supplier performance success. Rob Handfield made a pertinent comment that it is often [...] I was recently interviewed by business columnist Jamie Herzlich over at Newsday for an article she recently wrote, “Small Business: Choosing the Right Supplier.” (May 14, 2009) Many businesses are struggling with the challenge of how to choose the right suppliers. According to Ms. Herzlich, many business owners are unaware of what to look for in [...] Attracted by the potentially high cost savings and the direct impact on the corporation’s bottom line, some firms plunge directly into strategic sourcing activities without first fully understanding their spend. While they will probably achieve cost reductions, these firms are not reaping the full rewards of strategic sourcing and these savings may be short-lived. Why? Firms do not have [...] I was reading the recent blog post at the Spendmatters: Beyond Shedding the Deadweight in Procurement and Operations. Instead of just cutting headcount, particularly in procurement, Jason Busch suggests other ways to approach cost reduction. Among the suggestions are: driving better efficiency by fully using software solutions in the Procure-to-Pay cycle; using third parties to [...] My previous post about why supplier scorecards fail generated a lot of interest. So today I’m going to write about one of the biggest reasons for failed supplier scorecards: There is little or no action or follow through that results from the scorecards. Supply managers get so focused on the idea of having a supplier scorecard [...] |
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