Managing Procurement’s Brand Within the Business

Branding is an exercise in putting a coherent face on a product, service or corporate entity.  It makes the nature of the business being done and the philosophy behind it visible and transparent.

And for procurement, branding can be challenging.  Procurement’s role is rapidly shifting, becoming integrated with the business goals of the entities they serve as an integral part of how they serve them.  So, managing the procurement’s brand within the business demands that the shifting face of the sector serve the project of an effective branding initiative.

Where’s the emotional connection?

An effective brand connects with its market emotionally.  On a visceral level, the brand adheres to consumer consciousness, compelling loyalty.

So, where’s the emotional connection for procurement’s brand?  That’s largely determined by perception. And if procurement is perceived as a cost-cutting sheriff, counting the post-it notes and pens, then the perception is creating a notably negative emotional setting.

With procurement’s rising prominence as a driver of profitability, innovation and fidelity to ethical corporate missions through the supply chain, comes a re-branding opportunity.

A shift in perception may only be affected by the observer, ultimately.  But what procurement professionals need to do to shift that perception is to re-brand procurement’s true value.

That’s achievable through individual and collective engagement, meeting and exceeding expectations, extending innovative and meaningful transformation through data and technology and aligning itself with corporate goals.

Overall these perception-shifting actions is the umbrella of corporate culture.  Re-defining the mission of procurement in the light of his guiding framework is the key to the emotional connection a good brand establishes with its market.

A trusted advisor to leadership

While cutting costs is an impressive feat, leadership wants more from procurement now.  And procurement is positioning itself to take on the mantle of trusted advisor. And therein lies the brand.

Procurement leaders are now seated at the right hand of senior leadership, advising on corporate planning and budgeting.  In this space, they’re empowered to explore and innovate toward less costly and higher quality alternatives, often implicating key suppliers in the realm of development.

Innovation and insight

In working closely with suppliers, procurement professionals can drive the innovation lifecycle, supporting suppliers to not only serve buyers but to collaborate with them toward new horizons.

By collecting and collating supplier data, procurement leaders are creating new insights into markets via predictive analytics.  In this area, particularly, there is tremendous opportunity to change the game.

Managing supply chain risk

Supplier instability represents a rupture in the chain.  It can arrive suddenly, occasioned by worker unavailability, civic unrest or economic realities.  But with close working relationships with suppliers in place, procurement leaders are uniquely placed to manage the risk supplier instability represents.

All these qualities line up to create an entirely new perception of the procurement function and its role in business.  

Effective procurement professionals bring these qualities to the table, as trusted procurement advisors – a branded emblem of 21st Century procurement.

Procurement professionals are re-branding the sector to create new opportunities.  CenterPoint Group is leading the way. Contact us.

The post Managing Procurement’s Brand Within the Business appeared first on Centerpoint.

source https://centerpointgroup.com/managing-procurements-brand-within-the-business/

Stakeholder Engagement: Unlocking a Procurement Consultant’s Value

Engagement is a popular theme these days.  Everywhere you look people are talking about it in terms of employees, consumers – you name it.  But this post specifically addresses stakeholder engagement: unlocking a procurement consultant’s value.

And that’s precisely what engaging with internal client stakeholders does.  It allows procurement consultants to get up close and personal with the people deriving value from the relationship.  It takes that relationship between provider and client to the next level – deeper – bringing relatability and trust to the procurement function.

Let’s talk about what a “high-touch” client experience means to procurement consultants and how it adds value to the service we offer our clients.

Meeting specific need

The first step toward creating a lasting relationship is understanding what the other party needs.  That means drilling down. Breaching the boundary between the client (company) and its internal stakeholders means garnering knowledge about the requirements of their individual mandates.

That understanding leads procurement consultants straight to the heart of the matter – the drivers which are responsible for creating value intra-departmentally.

What looks good to one stakeholder may look quite different to another, so getting a handle on objectives held by internal people allows procurement consultants to answer specific demands for value which directly impact those objectives.

Out of invisibility

It’s too often the case that procurement is viewed form the standpoint of being solely a cost-cutting enterprise.  While it’s true that the right procurement consultant is going to save you money, it’s also true that smart procurement adds value in many other ways.

And procurement has been addressing the perception problem by shifting the focus from the bottom line to the KPI (key performance indicator) effect it can have on business.

The ongoing shift to greater sustainability and transparency in the supply chain is answering the need for companies to live up to their mission and values statements.  By working with suppliers to ensure these qualities are top-of-mind, procurement consultants add value, bringing them out of the cost-savings-focused shadows.

Risk management is part of that, as well as encouraging innovation from suppliers to better live up to the client’s stated commitment to a sustainable supply chain.

Acting as a liaison between client and suppliers, procurement consultants bring something new to the party.  It’s no longer all about the cost savings. It’s about companies being who they say they are and ensuring that all parties in the supply chain are on board and honoring a commitment which has been publicly stated.

Building rapport

Creating communicative opportunities allows procurement consultants to learn what is most important to internal stakeholders in a variety of business units, from finance to risk management.  This allows them to offer the value-added solutions that deliver a greater ROI beyond basic cost savings.

By participating in the business objectives of clients, procurement consultants align their work with that of senior stakeholders, adding value by sharing key goals.

Relationships matter.  When they’re intentionally constructed, procurement consultants become partners in the achievements their clients have top of mind.

CenterPoint Group is a trusted procurement advisor.  Contact us.

The post Stakeholder Engagement: Unlocking a Procurement Consultant’s Value appeared first on Centerpoint.

source https://centerpointgroup.com/stakeholder-engagement-unlocking-a-procurement-consultants-value/

Do You Know the Difference Between Strategic Sourcing and Category Management?

Opportunity abounds in the brave new world of procurement.  Category Management is part of that. Rapidly evolving to the status of a sector game-changer, Category Management is setting the foundation for the ability of procurement leaders to strategically align with business objectives.

As procurement transforms into a service that offers value well beyond cost-cutting initiatives, Category Management is emerging as a locus of sourcing strategies which serve the greater corporate good.  And that’s great news for procurement and for the businesses it works with and for.

Big differences

There’s more than one difference between strategic sourcing and category management. But the differences are about the fundamental nature of the two styles in play.

For example, strategic sourcing fulfills a function.  It is a cup of coffee from a vending machine compared to an espresso.  Category Management is primarily strategic, taking sourcing of goods and services from a solely cost-based fulfilment model to one which serves a greater purpose in organizations.

Supplier relationships is one key area in which category management departs from strategic sourcing decisively.  Traditional sourcing sets up an adversarial relationship between buyers and suppliers – locked in combat.

Category Management demands collaborative effort to reach a common goal – better delivery results in a better profile, as does higher quality achieved through mutually-pursued innovation.

Executive support for procurement goes beyond passively viewing bottom line results.  It deploys a proactive executive tier engaged with procurement for strategic effect.

Consultative collaboration

In a recent post, we’ve discussed the branding of procurement considering its ongoing transformation to a C-level function.  Consultative collaboration is a huge component of that transformation and the secret to transitioning a Strategic Sourcing model to a Category Management one.

For that to happen, procurement must be perceived (branded) as a strategic partner.  By developing new products and markets, procurement’s role becomes one of magnified value, down to the customer engagement level.

The consultative role of procurement resides in its understanding of processes and how they can be reformed to represent a profound sea change.  By bringing knowledge to the table which is otherwise obscure and applying it to problems like supply chain transparency and managing risk through that chain, procurement gets that coveted seat at the table.

Category Management is an opportunity for business and procurement is the door behind which it waits to be unleashed.

Value-creating sourcing

Category Management represents an evolution to the next level of maturity for Strategic Sourcing.  By fostering collaborative relationships with suppliers, the nature of sourcing is fundamentally changed, creating value-driven communities of procurement.

The systematic and disciplined approach to sourcing expressed by Category Management creates key relationships with suppliers.  When your suppliers provide the bulk of similar products and services within a given category you create opportunities for tremendous discounts.  

Building relationships intentionally is the basis for successful Category Management.  With time and realized objectives like delivery, value and innovation, the fruit borne by this style of sourcing is material.

CenterPoint Group is a trusted procurement advisor, bringing our clients focused, analytical account management.

The post Do You Know the Difference Between Strategic Sourcing and Category Management? appeared first on Centerpoint.

source https://centerpointgroup.com/do-you-know-the-difference-between-strategic-sourcing-and-category-management/

Building Win-Win Buyer/Supplier Relationships

Relationships can be complicated. As in personal relationships so is in procurement.  When things go sideways, someone always ends up on with the short end of the stick.

But it doesn’t need to be that way.

Building win-win buyer/supplier relationships is not a trick with mirrors.  It’s about applying the same respect and reciprocal impulse to the supply chain that exists in any healthy relationship, romantic or otherwise.

And that’s not exactly easy.  We’re not going to kid you. It’s a project.  But it’s a project with benefits which only become more apparent as the relationship gracefully ages into mutually beneficial satisfaction.

The four attributes

A study conducted by researchers at the Rutgers Business School examined buyer/supplier relationships in the US car industry over a 20-year period.  

Focusing on the suppliers’ perspective, researchers examined data from instances in which buyers were engaged in product development with suppliers – instances which present the greatest potential for conflict.  

Arising from that data were four interconnected attributes which define the subject of our post – win-win buyer/supplier relationships.  And again, they’re precisely what’s required to establish any healthy relationship.

Communication

When humans gained the powers of speech, we also gained the ability to collaborate effectively.  Communication is at the heart of any human interaction. But it can fall apart if people aren’t clear that they’re working toward a common goal.

Openness and clarity were deemed by suppliers in the Rutgers study to reinforce more effective relationships, especially where innovative collaboration is concerned.

Sharing plans with suppliers for innovative collaboration, even when they’re not involved, increases confidence in the relationship.  And communication fosters a sense of collegiality and (dare we say it) friendship.

Commitment

Many will tell you that a romantic relationship without a commitment is a flirtation.  Are you flirting with suppliers? Or are you in it for the long haul?

When you make a commitment, you inspire trust.  You’re a known quantity that’s taking the relationship seriously.  Where there’s trust, there’s a foundation for mutually-realized benefit for years to come.

Trust

Why would a supplier contribute ideas to product development in an environment which didn’t feel stable?  

Establishing trust brings out the riches of supplier knowledge that creates dynamic collaborations, reaping tremendous rewards.  Being trustworthy in the eyes of your partner establishes integrity and reliability. On that, a strong and fruitful bond may be built.

Equality

Buying things doesn’t imply the superiority of the buyer over the seller.  When that impression is conveyed, you’ve chosen your interests over those of your partner and over the enduring value of equality.

Power in relationships waxes and wanes but an intentionally stable power dynamic is rooted in mutually-acknowledged equality.

Establishing mutual dependency based on shared goals creates a functional understanding of the value of a relationship in total balance.

We know that relationships are tough. But win-win buyer/supplier relationships are well worth nurturing.  With the right deployment of the four Rutgers-identified attributes we’ve discussed in this post, you’ll enjoy flourishing, creative, collaborative relationships that stand the test of time.

And is there anything more serendipitous than happy relationships?  Contact us.

The post Building Win-Win Buyer/Supplier Relationships appeared first on Centerpoint.

source https://centerpointgroup.com/building-win-win-buyer-supplier-relationships/

New Challenges for Procurement Leaders

Gone are the days when procurement was all about dollars and cents.  Contemporary procurement leaders are onboarding more strategic responsibilities, with cost savings now a driver of profitability.

But that’s not what most of them signed on for.  Today, there are new challenges for procurement leaders.  The demand for supply chain transparency, accountability and sustainability is just one of them.  Companies are seeking new ways of delivering on the ethical commitments they’ve made to consumers and they’re recruiting procurement leaders to help them make that happen.

So, for procurement leaders, the rubber is meeting the road.  But in these challenges, there’s also great opportunity for procurement professionals to become integral participants in strategic sourcing that does more than hold the budget line.

Transformation

The role of procurement is being rapidly transformed and that transformation will only become more apparent over the next 10 years.  Their roles are growing to encompass brand integrity and advocacy for sustainable supply chain practices. They’re becoming supply chain cops who ensure that what’s said at the top of the chain trickles down as practice.

And companies who adopt this style of managing procurement are positioned to exceed the efforts of those who don’t.

They’re learning to not only manage risk but to anticipate it.  In a world of Big Data, this is how it’s put to superior use. The data garnered by the emerging transformation in procurement will play a huge part in that advantage, propelling the bold ahead.

Millennials driving change

As Millennials become the consumer market most sought out, their consumer decision-making process for will increasingly come to the forefront.

Part of that decision-making process concerns the ethical conduct of business with respect to where things come from, how they’re made and who’s making them.   Not responding to this impulse is tantamount to waving on the shore, as your cruise liner makes a bead for the Bahamas.

This cohort is changing the way companies do business by demanding supply chain transparency and what’s more – a less disposable commercial landscape.  They desire a world of reduced waste, the increased availability of locally-sourced goods and ethical practices abroad, when that’s not an option.

The numbers game

Procurement leaders would be well-served to start learning more about the way the money goes around and around.  For now, their financial focus has been on simple costs for goods, services and all the nuts and bolts of getting them to clients.

To meet the extraordinary challenge of supply chains gone global, their financial skills will need to experience a rapid expansion.  Already, there’s a trend toward integrating the emerging value of procurement with the skills of finance, creating a Center of Excellence which teams the two in common purpose.  Companies are taking note that this alliance holds in it endless promise and explosive power.

To procurement leaders, all this will sound familiar.  They may even be a little nervous about the challenges they’re facing.  But they’d be well-served to remember that is procurement’s special day and to seize it.

CenterPoint Group is a trusted procurement advisor.

The post New Challenges for Procurement Leaders appeared first on Centerpoint.

source https://centerpointgroup.com/new-challenges-for-procurement-leaders/

Do You Receive Detailed Reporting of Your Spend?

You’re a big picture person.  You know the basics about your procurement budget, but you may not have a handle on the finer details.

That can mean money’s flying out the window.

You can’t be everywhere.  You can’t know whether Betty in Denver is procuring in a less than efficient way.  There’s no way to know if Ted in Houston has gone light bulb crazy in the wake of a sudden shortage.

And how long will those lightbulbs be collecting dust so Ted won’t be caught holding the (spent) light bulb again?

Your operations are all over the place, so there’s a good chance your indirect spend is too.  Do you receive detailed reporting of your spend? Probably not, right?

You’re not alone.  There are responsible people all over the USA dealing with a lack of transparency and centralization in procurement.

And when you don’t get the deets, how can you know whether your spend is efficient and serving your company?

Knowledge is power

At CenterPoint Group, we fill in the reporting gaps, with total transparency that lets you know exactly what’s going on.  No more Betty in Denver. No more Ted in Houston. Your procurement gets detailed, centralized reporting that lets you see the details in your spending big picture.

With our proprietary software, we stay on top of even the most high-transaction spends with an ongoing data feed from individual suppliers.  We bring you insight, which amounts to knowledge, which gives you power.

Eyes on the prize

Errors on your billings aren’t left to languish with CenterPoint.  We ensure accuracy by keeping our eyes on the prize.

That includes paying keen attention to pricing changes, being aware of products which have been discontinued and knowing what’s going on beneath the surface of your spend.

And we don’t stop there.  Markets change and so do your buying patterns, so we periodically optimize our processes to ensure you’re still getting the best deal possible.

We’re always in negotiation mode, so you and your people don’t need to be, getting you optimal pricing over a wide range of regular purchases.

Data matters

Detailed reporting of your spend relies on data, which provides all the information you need to maximize your purchasing power.

Procurement is being revolutionized by big data, which points to opportunities which can save you money.  Intuition and instinct are great things to have, but they’re supported by concrete data that tells you the unvarnished truth, allowing you to respond rapidly to challenges and resolve them effectively.

With our proprietary software, every transaction is analyzed, meaning you get every detail and every detail matters when you’re optimizing your spend.

The power of numbers

Our members get the purchasing power of numbers, represented by over $850 million of collective, indirect spend.

With that kind of clout behind you, you get the pricing that only larger companies with bigger budgets usually have access to.

And CenterPoint has the kind of negotiating leverage that holds the pricing line, allowing you to focus on other areas.  Contact us to find out more.

The post Do You Receive Detailed Reporting of Your Spend? appeared first on Centerpoint.

source https://centerpointgroup.com/do-you-receive-detailed-reporting-of-your-spend/