Monday 10 December 2012

What’s Your Fiscal Gift for 2012?

Authored by: Mickey North Rizza

As you exit 2012, what is your Fiscal Gift to your business? Has your team delivered on their commitments to meet revenue, cost, working and fixed capital targets? Did your team meet their objectives, fulfilling the business needs for greater shareholder value? Why or why not? What would you do differently and how does that change your plans for 2013? What improvements in your strategy and plans must be made to meet and exceed next year’s goals and objectives? A quick poll at a recent conference uncovered 65% of procurement executives who had not yet prepared a full strategy and plan for 2013, leaving a real concern about their ability to meet their upcoming objectives.

A strategy that lays out the next 1 – 5 years will provide a growth roadmap. The roadmap can then be broken down into annual segments, creating a plan to capitalise and make the most of each year. Considerations such as KPIs to drive change and improvements; activities focused on projects that will bring more monetary value to top and bottom lines; and a plan with multiple levers to pull so that if one effort stalls or falls away, others can quickly replace it so success is inevitable. All are key elements of foolproof plans.

If your Fiscal Gift for 2012 wasn’t something that made you proud, then start preparing for 2013 now. Preparedness is the key to success, even with the surprises that await in 2013.

Wednesday 21 November 2012

Austerity Disobedience a Threat to the Supply Chain?

Authored by Mickey North Rizza

Last wednesday in Europe: Hundreds of flights were cancelled and car factories and ports closed. Trains barely ran in Spain and Portugal. According to reports, additional international rail services were disrupted by strikes in Belgium.

Beyond the obvious disruption of these protests, they also impact the supply chain. Transporters in areas affected by protests can’t deliver – leaving manufacturers in many areas (even those outside the affected zones) scrambling to find the parts they need to fill orders.

2013: The Year of Contribution Value

Authored by Mickey North Rizza

Over the past few weeks my discussions with CPOs and Procurement executives has been enlightening. In 2013 Procurement leadership will be focused on strategic objectives that provide more contribution value. Trends include Procurement objectives tied to expense reduction, cost of good sold (COGS), increased revenue, and working capital; roadmaps outlining steps to success; and KPIs to show progress.
While the trends are pretty straight forward, I discovered a few glaring holes in the plans, along with a few ideas that might start to close the gaps.

Monday 5 November 2012

The Straw That Broke the Camel’s Back

Authored by: Mickey North Rizza

In a new blog post, procurement expert, Dr. Gordon Murray, highlights how important the little things are to overall supplier strategy and sourcing success.

Wednesday 31 October 2012

Advanced Spend Analysis: Take Your Sourcing Operations to a New Level

Authored by: Mickey North Rizza

How much are we spending? Who are we spending it with? How can we save even more money?

For many organizations – spend analysis provides the answers. But too often, the process stops after procurement cuts the ‘low hanging fruit.’

Cost cutting will always be critical, but companies miss a major opportunity to really impact their top- and bottom-line. The reasoning: Their visibility, data and analytics are limiting.

There are many roadblocks that hold companies back from going deeper with spend analysis. The most pressing: lacking time and resources, and limited data sets. Regardless of the reason, a surface-level approach to spend analysis fails to paint a complete picture of an organization’s spending, and limits procurement’s impact.

Wednesday 10 October 2012

Procurement Value Creation Ideas

Authored by: Mickey North Rizza

Much has been written about procurement value creation. When all’s said and done it is about providing company shareholder value. Shareholder value equates to profitability and return on investment (ROI). If you analyze these two components you can capitalize on a few ideas to help your business move forward.

Monday 8 October 2012

Defensive Behavior: A Sign of Lost Opportunity for Value Creation

Authored By Mickey North Rizza

Procurement organizations have long been criticized for being overly cost conscious, resource and technology constrained and extremely reactive. This perception fuels negativity within the Procurement team, bringing about defensive behavior. The perception turns to reality when senior management finally takes notice – their Procurement team is a laggard when compared to the industry leading Procurement teams. Unfortunately, it is also a sign of lost opportunity and can equate to millions and even billions of pounds in lost revenue, cost savings, and working capital.

Friday 5 October 2012

Is your Procurement Team Driving on all Cylinders?

Authored by Mickey North Rizza

Have you ever ridden in a convertible car that is just purring along the highway, with the wind providing just enough breeze to keep you cool, the stereo and speakers on the perfect tune, and you feel you are in total control and in harmony with the road and your surroundings? That is the precisely what happens when procurement value contribution becomes so significant that it positively impacts both the top and bottom lines of the business.

Monday 1 October 2012

What is Spend Under Management?

Authored by: Mickey North Rizza

“Spend Under Management” is a misunderstood term among procurement professionals. Spend is the easy part of the definition, but ‘under management’ is left up to the definition of management.

Those starting to measure Spend Under Management typically consider it to be the Spend that is actually touched by procurement (source to pay). More advanced companies consider it the Spend that is covered by a sourcing plan, sourced, contracted and controlled.