While the direct spend is almost always optimized to within an inch of its life, leaving very little room for further savings, indirect often takes a backseat.
However, the heart of source-to-pay lies in indirect goods and services – the domain of the Chief Procurement Officer (CPO). Managing them effectively requires specialized expertise and purpose-built tools, honed to streamline requisitioning, negotiation**, and supplier engagement. – Don’t Get Boxed In: Why Source-to-Pay Simplicity Reigns Supreme by Amit Shah, CMO & Head Global BD, Zycus
Amit Shah, Zycus
Amit Shah’s comments regarding indirect procurement hit close to home in a post that hits the mark on multiple key points regarding the importance of problem-solving versus solution selling.
For those of you who have been following this blog over the past 16 years – and those who have been following me longer, you know where I am going with this post. Well, and I say this without apology: buckle up because here we go again!
Procurement Experts Outlook 2024
In an upcoming survey, I was asked the following question: What best practices should be adopted to maximize the efficiency of procurement processes?
The following was my answer.
Here is a simple three-step process:
- Step 1 – Commodity Characteristic Analyses
- Step 2 – Effective Process Alignment
- Step 3 – Effective Technological Alignment
Reference Link: https://bit.ly/3oe5Vql
You will want to check out the link for the whole story, but here is the outcome of the three-step approach for the Department of National Defence:
“By August 2003, a full production program was introduced and successfully tested. (In the test case, a major public sector organization realized a 23% cost of goods savings annually over a period of several years while simultaneously reducing the number of buyers required to manage the contract to 3 from an original 23. Delivery performance and product quality also improved dramatically.)”
Once again, use the above link to access the finer details of executing each step, but note what step involved introducing technology.
For today’s post, what is most encouraging about the Shah article is how, from the solution map maze and haze, understanding, insights, and simplicity beyond a provider’s technology are emerging from behind company logos.
Where does technology come into play in your problem-solving process?
A heads-up – Building on the above post’s strong message of orderly digital transformation progression, be sure to check out my next post featuring a discussion between procurement thought leader Duncan Jones and me.
** A word about negotiation . . .
In the same Procurement Experts Outlook 2024 Survey, I was also asked the following question: Can you provide examples of potential applications of Generative AI in the S2P process?
Here is my answer:
“One example that immediately comes to mind involves the negotiation process. Built on a conversational AI model, providing users with ultra realistic, immersive, and engaging experience to develop their negotiation skills, LavenirAI has an inherent self-learning capability that produces logical responses based on actual interactions versus a static list of set responses. In short, it learns, expands, and adapts the avatar’s capability for fluid response in real time.“
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Procurement Insights
When it comes to S2P, which requires more of a CPO’s attention – direct or indirect spend?
Posted on January 12, 2024
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While the direct spend is almost always optimized to within an inch of its life, leaving very little room for further savings, indirect often takes a backseat.
However, the heart of source-to-pay lies in indirect goods and services – the domain of the Chief Procurement Officer (CPO). Managing them effectively requires specialized expertise and purpose-built tools, honed to streamline requisitioning, negotiation**, and supplier engagement. – Don’t Get Boxed In: Why Source-to-Pay Simplicity Reigns Supreme by Amit Shah, CMO & Head Global BD, Zycus
Amit Shah, Zycus
Amit Shah’s comments regarding indirect procurement hit close to home in a post that hits the mark on multiple key points regarding the importance of problem-solving versus solution selling.
For those of you who have been following this blog over the past 16 years – and those who have been following me longer, you know where I am going with this post. Well, and I say this without apology: buckle up because here we go again!
Procurement Experts Outlook 2024
In an upcoming survey, I was asked the following question: What best practices should be adopted to maximize the efficiency of procurement processes?
The following was my answer.
Here is a simple three-step process:
Reference Link: https://bit.ly/3oe5Vql
You will want to check out the link for the whole story, but here is the outcome of the three-step approach for the Department of National Defence:
“By August 2003, a full production program was introduced and successfully tested. (In the test case, a major public sector organization realized a 23% cost of goods savings annually over a period of several years while simultaneously reducing the number of buyers required to manage the contract to 3 from an original 23. Delivery performance and product quality also improved dramatically.)”
Once again, use the above link to access the finer details of executing each step, but note what step involved introducing technology.
For today’s post, what is most encouraging about the Shah article is how, from the solution map maze and haze, understanding, insights, and simplicity beyond a provider’s technology are emerging from behind company logos.
Where does technology come into play in your problem-solving process?
A heads-up – Building on the above post’s strong message of orderly digital transformation progression, be sure to check out my next post featuring a discussion between procurement thought leader Duncan Jones and me.
** A word about negotiation . . .
In the same Procurement Experts Outlook 2024 Survey, I was also asked the following question: Can you provide examples of potential applications of Generative AI in the S2P process?
Here is my answer:
“One example that immediately comes to mind involves the negotiation process. Built on a conversational AI model, providing users with ultra realistic, immersive, and engaging experience to develop their negotiation skills, LavenirAI has an inherent self-learning capability that produces logical responses based on actual interactions versus a static list of set responses. In short, it learns, expands, and adapts the avatar’s capability for fluid response in real time.“
30
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