This dialogue occurred on Tuesday, April 26, at 2:00 p.m. EDT.
Date: Tuesday, April 26, 2011
Time: 2 p.m. ET / 11 a.m PT
Host: Newark’s Dianne Kibbey, Global Head of Community & eProcurement
Topic: Reduce Procurement Costs Without Spending a Cent
Goods procurement can include significant costs and efficiency challenges for most businesses, unless you have the right processes in place. Done right, electronic procurement can deliver direct cost savings. Join EBN editors and Newark's Global Head of Community and eProcurement, Dianne Kibbey, on April 26, 2 p.m. EST, for a live discussion on leveraging e-procurement tools. Kibbey will provide insight on how to access the IBUY suite of tools to automate purchasing workflow and reduce the overall costs of purchasing electronic components.
Yes, We recently had a customer that implemented IBUY 6 months ago with one small engineering staff with spend limts, blanket POs and budgets, and because of the sucess of the user group and efficiencies gained, they have added 6 other engineering groups. The leader of this implementation is now providing monthly financial reporting directly out of IBUY.
As we wrap this up, I want to thank Dianne for her time, and to our readers for joining us. i apologize for a few technical difficulties we had--we'll figure them out and see you all next time, I hope
If you would like more details, send a message to eProc@newark.com. As well, you can find some general materials on our website. Thanks! We are always up for giving a live demo.
Dianne--you have an example of one customer that started using ibuy for a few items and expanded that--can you share a couple of the benefits for that custoemr?
Tom, as pragmatic way I have experienced, was put in place a process in parallel to monitor "marverick" spending and appoint a specific "duty manager" in the role of escalation point to decide or not an off-contract buying
Agree. Our customers are in a wide range of maturity in this area. This is why we typically include ramp up programs and training with our customers, even with IBUY. Its really as easy as using our website and the use can grow as the customer matures.
Here's the intersting thing about iBuy--you can program the cost parameters in it. In other words, if your buyer has a limit--say $100--the systems will process that. If it's $10,000 ditto. You control your own costs this way
@Nemos It usually requires a good amount of customization and integration points to get it working right depending on the industry vertical and business processes. But for the most part, there are alot of 'templates' to use to get started.
Plus cost is always an issue. Even when it's supposedly free there is always a fear of hidden fees or ancillary costs that won't get disclosed until checkout. Or, the extra cost might have been built into the purchase. What we need mainly is continuing education from the experts to dispel the myths and address the potential problems.
Yes Anna, you are right, we need to consider also those situations and once again I believe even tools could support a lot, finally it is up to buyer ability to achieve results and savings as well
Diane, You'll be amazed how much is still not automated or done online but through the old telephone line. We can still squeeze a lot of productivity out of our system but folks -- don't cite me -- are still scared of new things, unable to use them and need education or simply stuck. Then there is the fear of what comes with the automated process, whether or not it's safe to link up with a supplier, trust an outside party (like Newark) or worse, just simply stay stuck because "we only buy small lots anyway and don't need all these fancy stuff."
Re: counterfiets--a tool is only as good as the process a buyers uses. Newark is an authorized distributor of products and as such is the best source for authentic goods. If a buyer goes outside authorized channels, that is where the risk is. Any tool offered by an authorized distrbutor gives the best protection against counterfieting that the authorized channel can
mfbertozzi, yes, a good platform should but that platform may also be going beyond the mandate of the people offering it. This could get companies like Newark going beyond their raison d'etre to offer products in eprocurement that may have limited payoff for them even while customers are delighted. You may find yourself paying at that moment, which would defeat the purpose of offering it free.
Hi Hawk--I don't think any tool can solve supply/demand problems in overall supply chian. What they can do is give maximum visibility into your particular procurement issue. At the end of the day, that's what I'd worry about--how does this help me?
Sometimes it is tipical especially especially when buyer is in emergency. A good platform has to avoid that condition or suggest at least alternative paths to follow.
How does this stack up, though, in an environment of tight supplies? The industry has been prone in the last two decades to bouts of disequilibrium with supply overshooting demand in one season and years later demand exceeding supply severely. That's still a major worry for many of us -- the ability to when we need it get what we need at the right price. Is there a forecasting side to iBuy that helps to limit the impact of supply-demand imbalance or are there other tools available at Newark to the procurement community for this? Perhaps this is even something EBN should be offering in partnership with companies like Newark -- like you get your latest development and procurement tools from the same location.
We see IBUY and the investment we made as a win win. This has been a good business decision in building our customer loyalty. Supporting our cusotmers' needs is critical. We saw the need to support our customers move to procurement automation over 12 years ago when we began supporting their enterprise eProcurement. Since then we have continued to innnovate in this area based on customer input. IBUY was the direct result of customer input and requests.
Hawk--that's right. Some tools limit you to the products that the developer--in this case, a distributor--offers. Newark's taking the chance that users will consoldidate their business under the newark/PF umbrella--whihc make sense if users are getting the same price they do from any other source. It means more business being conducted with Newark--so it is a win-win
I believe a very effective application similar to this would also help to address challenges procurement folks face. One of this is tracking down the products you need, determining end-of-life and lifecycle issues and gauging the abilities of the supplier to support volume purchase. My feeling is that Newark would not be backing this and opening it up to the eprocurement world unless they are sure its utility goes beyond cost savings.
Hi, I totally agree. We have found that customers that have used IBUY and eProcurement have become more efficient and the cost savings has actually saved jobs!
So, Barbara, that means, the buyer is not tied to Newark, right? What then is the benefit to Newark of offering this service? In the end the company is still a components distributor offering customers value added services. It must get paid. It spent money developing the application. Does that add to my cost?
OfficeMAx does have a similar interface on their website. Can you please clarify what your question for me. Are you asking how these online tools can compare to outsourcing your procurement function?
We are speaking her to ways to reduce the cost of procuring electronic components from Newark. From our website you have access to a fully functional procurement tool that can be customized for your organization's needs. This includes spent limits, approval workflows, reporting and budgets. This doesn't cost a penny to your organization as opposed to a costly eProcurement system.
I thnk you have a similar question. IBUY provides much of the same functionality as a fully integrated eProcurement system however Newark does not charge its customers for use of this tool. This enables your organization to have full visibility to your electronics spend, manage users and spend limits, while providing your contract specific pricing across over 500 manufacturers products. We can arrange for a demo if you are interested.
We are referring to the overall efficiency and savings of your procurement process and automating this within your organziation. You would be able to use the IBUY software to setup your organization's structure and purchasing process (approvals, limits, access to budgets) and reporting. You can also streamline the transaction as it comes electrronically.
You had asked about centralized procurements and its effectiveness in a distributed environment. Great question. This is about having central purchasing standards and controls but giving your buyers and end users the access they need to get their jobs done. Typically you need something easy to use but powerful enough to control the limits on spend. IBUY can provide the distributed access (just need access to the web) and the controls that you setup in your organization. More than 3,000 companies are using this for this purpsoe.
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
Our customers have stated savings in the way of transactional processing costs (for example EDI), time savings by eliminating paper processes, and reducing maverick spend. The actual dollar amounts vary across organizations. These are the typical savings that are seen by implenting an enterprise eprocurement system but without the high price tag. Typically an ERP purchasing system can take 2-3 years and this gives immediate access and benefit in a day.
Maybe I can help. In researching iBuy and eprocurement tools, the bottom line is the felxibility and scalability of the tool. For example, you can use iBuy to procure a single line item or your whole BOM. You can use your AVL and your own contract prices. Now, it helps if you can source those though one of the Premier Farnell companies--that gives you the most leverage. But iBuy simplifies the process--you set the parameters you want to operate under
I wonder if iBuy offers a way directly to interact with the suppliers. While the backend may be important, developing a close relationship with suppliers is still key. If Newark is involved in the process does that remove the element of the interraction with the suppliers and if it does, is Newark able to efficiently represent the people who use your tools?
Dear all, I was thinking, in general, about e-procurement tools plus, in purchaising processes. It is not easy, personally speaking, to outline reduction from them in REEs market or maybe I am not an expert the plus exists I am not able to summarize it. Any opinion from your side?
Even though E-procurement can reduce the number of purchasing employees needed or obviate the need to increase staffing as purchasing activity grows, I would like to know how we can justify this statement in todays unemployment senario
We are speaking her to ways to reduce the cost of procuring electronic components from Newark. From our website you have access to a fully functional procurement tool that can be customized for your organization's needs. This includes spent limits, approval workflows, reporting and budgets. This doesn't cost a penny to your organization as opposed to a costly eProcurement system.
OfficeMAx does have a similar interface on their website. Can you please clarify what your question for me. Are you asking how these online tools can compare to outsourcing your procurement function?
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
Our customers have stated savings in the way of transactional processing costs (for example EDI), time savings by eliminating paper processes, and reducing maverick spend. The actual dollar amounts vary across organizations. These are the typical savings that are seen by implenting an enterprise eprocurement system but without the high price tag. Typically an ERP purchasing system can take 2-3 years and this gives immediate access and benefit in a day.
You had asked about centralized procurements and its effectiveness in a distributed environment. Great question. This is about having central purchasing standards and controls but giving your buyers and end users the access they need to get their jobs done. Typically you need something easy to use but powerful enough to control the limits on spend. IBUY can provide the distributed access (just need access to the web) and the controls that you setup in your organization. More than 3,000 companies are using this for this purpsoe.
We are referring to the overall efficiency and savings of your procurement process and automating this within your organziation. You would be able to use the IBUY software to setup your organization's structure and purchasing process (approvals, limits, access to budgets) and reporting. You can also streamline the transaction as it comes electrronically.
I thnk you have a similar question. IBUY provides much of the same functionality as a fully integrated eProcurement system however Newark does not charge its customers for use of this tool. This enables your organization to have full visibility to your electronics spend, manage users and spend limits, while providing your contract specific pricing across over 500 manufacturers products. We can arrange for a demo if you are interested.
When I was working to service center we had two different programs one for internal use (Navi) and one for ordering spare parts, and it was so confusing, and we had to spent hours for both programs.
Our customers have stated savings in the way of transactional processing costs (for example EDI), time savings by eliminating paper processes, and reducing maverick spend. The actual dollar amounts vary across organizations. These are the typical savings that are seen by implenting an enterprise eprocurement system but without the high price tag. Typically an ERP purchasing system can take 2-3 years and this gives immediate access and benefit in a day.
We are referring to the overall efficiency and savings of your procurement process and automating this within your organziation. You would be able to use the IBUY software to setup your organization's structure and purchasing process (approvals, limits, access to budgets) and reporting. You can also streamline the transaction as it comes electrronically.
Plus, This is a chat. We don't always have to direct questions at Diane. We can also comment on and provide feedback to her responses and get a conversation going. This would give her time to respond to earlier questions.
OfficeMAx does have a similar interface on their website. Can you please clarify what your question for me. Are you asking how these online tools can compare to outsourcing your procurement function?
You had asked about centralized procurements and its effectiveness in a distributed environment. Great question. This is about having central purchasing standards and controls but giving your buyers and end users the access they need to get their jobs done. Typically you need something easy to use but powerful enough to control the limits on spend. IBUY can provide the distributed access (just need access to the web) and the controls that you setup in your organization. More than 3,000 companies are using this for this purpsoe.
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
OfficeMAx does have a similar interface on their website. Can you please clarify what your question for me. Are you asking how these online tools can compare to outsourcing your procurement function?
We are speaking her to ways to reduce the cost of procuring electronic components from Newark. From our website you have access to a fully functional procurement tool that can be customized for your organization's needs. This includes spent limits, approval workflows, reporting and budgets. This doesn't cost a penny to your organization as opposed to a costly eProcurement system.
I thnk you have a similar question. IBUY provides much of the same functionality as a fully integrated eProcurement system however Newark does not charge its customers for use of this tool. This enables your organization to have full visibility to your electronics spend, manage users and spend limits, while providing your contract specific pricing across over 500 manufacturers products. We can arrange for a demo if you are interested.
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
You had asked about centralized procurements and its effectiveness in a distributed environment. Great question. This is about having central purchasing standards and controls but giving your buyers and end users the access they need to get their jobs done. Typically you need something easy to use but powerful enough to control the limits on spend. IBUY can provide the distributed access (just need access to the web) and the controls that you setup in your organization. More than 3,000 companies are using this for this purpsoe.
There are certian software tools like OfficeMax for reducing the procurement costs. How it can be effective when compare with manuel machanisoms like Outsourcing, minimal cost accounting etc
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
I thnk you have a similar question. IBUY provides much of the same functionality as a fully integrated eProcurement system however Newark does not charge its customers for use of this tool. This enables your organization to have full visibility to your electronics spend, manage users and spend limits, while providing your contract specific pricing across over 500 manufacturers products. We can arrange for a demo if you are interested.
We are speaking her to ways to reduce the cost of procuring electronic components from Newark. From our website you have access to a fully functional procurement tool that can be customized for your organization's needs. This includes spent limits, approval workflows, reporting and budgets. This doesn't cost a penny to your organization as opposed to a costly eProcurement system.
I thnk you have a similar question. IBUY provides much of the same functionality as a fully integrated eProcurement system however Newark does not charge its customers for use of this tool. This enables your organization to have full visibility to your electronics spend, manage users and spend limits, while providing your contract specific pricing across over 500 manufacturers products. We can arrange for a demo if you are interested.
We are speaking her to ways to reduce the cost of procuring electronic components from Newark. From our website you have access to a fully functional procurement tool that can be customized for your organization's needs. This includes spent limits, approval workflows, reporting and budgets. This doesn't cost a penny to your organization as opposed to a costly eProcurement system.
Even though this may be a basic question, I would like to understand your comprehension of total procurement cost. What would you include in this? I believe this distinction is important to understanding how to reduce costs overall, whether totally or by segment.
Hello Everyone! Thanks for attending our session today. I'm looking forward to answering your questions and will get to as many as I can within the hour.
The discussion will start in about 11 minutes. If you feel like posting questions please go ahead. We'll encourage Ms. Kibbey to review this and answer some of them during the Live Chat.
How do you reduce the cost of procurement without spending a cent when your rival is a company called Apple and it is spending -- spending not cents but bucketloads? That's only the first of my questions. I am wondering also how you reduce the cost of procurement when your suppliers are running out of parts due to a natural disaster and the only way to get what you need is to pay premium? This should be a fun discussion.
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